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State of Arizona
Office
of the
Auditor General
PERFORMANCE AUDIT
Report to the Arizona Legislature
By Debra K. Davenport
Auditor General
February 2000
Report No. 00-2
BEHAVIORAL
HEALTH
SERVICES
INTERAGENCY
COORDINATION
OF SERVICES
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee
composed of five senators and five representatives. His mission is to provide independent and impar-tial
information and specific recommendations to improve the operations of state and local government
entities. To this end, he provides financial audits and accounting services to the state and political
subdivisions and performance audits of state agencies and the programs they administer.
The Joint Legislative Audit Committee
Representative Roberta L. Voss, Chairman
Senator Tom Smith, Vice-Chairman
Representative Robert Burns Senator Keith Bee
Representative Ken Cheuvront Senator Herb Guenther
Representative Andy Nichols Senator Darden Hamilton
Representative Barry Wong Senator Pete Rios
Representative Jeff Groscost Senator Brenda Burns
(ex-officio) (ex-officio)
Audit Staff
Shan Hays—Manager
and Contact Person (602) 553-0333
Lois Sayrs—Methodologist
Kim Van Pelt—Audit Senior
Kip Memmott—Audit Senior
Monique Cordova—Staff
Teresa Bennett—Staff
Julie Maurer—Staff
Angelica Gonzalez—Staff
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
(602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553-0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
February 15, 2000
Members of the Legislature
The Honorable Jane Dee Hull, Governor
Dr. James L. Schamadan, Acting Director
Department of Health Services
Transmitted herewith is a report of the Auditor General, a performance audit of the
coordination and provision of behavioral health services among selected state agencies, in
response to an October 6, 1998, resolution of the Joint Legislative Audit Committee. The audit
was conducted under the authority vested in the Auditor General by A.R.S. §41-1279.
This report addresses why people referred from other state agencies to the state behavioral
health system do not always receive services. Several factors appear to contribute to such
service denials. First, we found that disputes over the medical necessity of services and
agency roles in serving clients with special needs often contribute to disagreements over
needed services. Second, there is some confusion over whether some services, particularly
substance abuse services, are available to Medicaid clients. Confusion also exists over whether
clients referred by other state agencies are actually enrolled in the Medicaid program. Finally,
some services are simply unavailable, especially for disruptive clients or for clients living in
rural areas. Several recommendations, ranging from clarifying existing policies to transferring
the administration of behavioral health services for developmentally disabled ALTCS clients,
are offered to help diminish interagency disagreements and improve access to needed
services.
This report also recommends that the Division of Behavioral Health Services play a greater
role in providing treatment for Medicaid-eligible juvenile sex offenders on parole or
probation, and Medicaid-eligible juveniles who are removed from prison for behavioral
February 15, 2000
Page -2-
health treatment. Such a shift in service provision could help the State save money. If BHS
provides such services when medically necessary with Medicaid dollars, the State may be able
to conserve money since Medicaid dollars are largely financed by the federal government.
Currently, such services are paid for by the courts and Juvenile Corrections using state-only
dollars.
As outlined in its response, the Department of Health Services agrees with all of the findings
and recommendations. In addition, although they were not asked to provide written re-sponses
to the report, the Arizona Health Care Cost Containment System (AHCCCS), the
Arizona Office of the Courts, the Department of Juvenile Corrections, and the Department of
Economic Security reviewed the report. All four agencies also agreed with the recommenda-tions
that pertained to them.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on February 16, 2000.
Sincerely,
Debbie Davenport
Auditor General
Enclosure
OFFICE OF THE AUDITOR GENERAL
i
SUMMARY
The Office of the Auditor General has conducted a performance
audit of the coordination and provision of behavioral health
services among selected state agencies, in response to an October
6, 1998, resolution of the Joint Legislative Audit Committee. The
audit was conducted under the authority vested in the Auditor
General by A.R.S. §41-1279. A separate review of the Department
of Health Services—Division of Behavioral Health Services
(BHS) was issued in July 1999 (Report No. 99-12).
Although BHS is responsible for providing publicly funded be-havioral
health services in Arizona, many individuals with be-havioral
health needs first encounter another public agency, such
as a court or the Department of Economic Security. The agencies
often refer these individuals to BHS for services, but are not al-ways
able to access all of the care agency officials believe is
needed for their clients. Previous studies by legislative commit-tees
and private organizations have recommended ways to im-prove
interagency communication and reduce duplicated efforts.
In this audit, in-depth case studies were conducted to explore the
reasons some individuals do not receive the services requested
by the referring agencies. These case studies, along with other
audit methods such as interviews and reviews of documenta-tion,
uncovered common themes that help to explain interagency
disagreements and suggest additional recommendations for
ensuring that other agencies’ referred clients receive appropriate
services.
Managed Care Focus, and Structure
That Divides Responsibility, Leads
to Interagency Disagreements
(See pages 11 through 21)
Arizona’s behavioral health system has three characteristics that
contribute to interagency disagreements.
n First, its managed care focus provides some incentive for
limiting services in order to minimize costs. The Regional
Individuals with behavioral
health needs often encounter
other agencies first.
Summary
OFFICE OF THE AUDITOR GENERAL
ii
Behavioral Health Authorities (RBHAs) that contract with
BHS to administer the delivery of behavioral health services
may incur financial losses if they spend more than the fixed
sum they receive in advance.1 As a result, RBHAs monitor
service utilization, require authorization for service beyond
predetermined limits, and deny services when they are not
medically necessary.
n Second, Medicaid rules require RBHAs to provide only
services that are “medically necessary,” a standard with an
appropriately broad definition that provides ample discre-tion
for allowing or denying services. According to Arizona’s
definition of medical necessity, services must be expected to
benefit the client’s mental or physical health, and should be
delivered in the least restrictive setting proven or predicted to
be effective in meeting the client’s behavioral health needs in
order to conserve costs.
n Third, the fragmented structure of service provision between
agencies allows cost-shifting between agencies. Other agen-cies
can sometimes purchase behavioral health services for
their clients, making it difficult to determine which agency
should pay for such services for a shared client. Distinctions
between agency roles are unclear in some cases.
These system characteristics contributed to interagency dis-agreements
regarding two cases auditors examined, Todd and
Irene.2 Todd, a 15-year-old boy referred to BHS by Child Protec-tive
Services (CPS), was receiving services in a residential treat-ment
center where staff supervised him 24 hours a day, but these
services were terminated by a RBHA psychiatrist who said they
were not medically necessary. Although Todd’s court-appointed
psychiatrist and CPS caseworker believed he needed to stay in
the supervised setting, where he did well, the RBHA psychiatrist
thought his good progress in the supervised setting indicated his
behavioral problems might be caused by family problems at
1 The Division may adjust capitation rates or payments to RBHAs if
losses are too great. Further, contractual limits on the amount of
profit that can be realized by the RBHAs further guard against un-derservice.
2 All names cited in the report have been changed to protect privacy.
Summary
OFFICE OF THE AUDITOR GENERAL
iii
home. In Todd’s case, professionals disagreed about the neces-sity
for providing services in a restrictive live-in setting.
Cost-shifting appeared to be a factor in Irene’s situation. Irene, a
client of DES’ Division of Developmental Disabilities (DDD), has
cerebral palsy, which does not create behavioral health prob-lems.
However, RBHA staff attempted to shift responsibility for
Irene’s services to DDD, first by alleging that her behavioral
health problems were caused by mental retardation, and later,
when they learned she did not have mental retardation, by
claiming that her cerebral palsy explained her behavior.
To alleviate these types of disputes, responsibility for some cli-ents
such as some DDD clients could be transferred away from
the RBHAs. In addition, agencies could make some procedural
changes and BHS could improve its oversight of the RBHAs.
Specifically:
n DDD could assume responsibility for some of its own clients’
behavioral health services. This would be comparatively easy
because DDD already has the needed financial and informa-tion
systems in place for clients enrolled in the Arizona Long
Term Care System (ALTCS).
n BHS and other agencies could reduce medical necessity dis-putes
by working with other agencies to develop methods
for routinely reviewing and synthesizing all agencies’ as-sessment
information, and ensuring that RBHA staff respon-sible
for performing assessments are adequately qualified.
n Finally, to ensure that clients receive adequate and appropri-ate
care, BHS should continue to improve its oversight of
RBHAs to help ensure they do not inappropriately limit or
deny services.
Confusion Exists
Regarding Medicaid Coverage
(See pages 23 through 32 )
Confusion over which services Medicaid will cover explains why
some clients may be denied services. Substance abuse coverage,
in particular, sometimes may be misunderstood by RBHA offi-
Cost-shifting appeared to be
a factor in the case of Irene,
a DDD client.
Summary
OFFICE OF THE AUDITOR GENERAL
iv
cials, leading to inappropriate service denial. Medicaid does pay
for medically necessary substance abuse services, regardless of
whether the client has another behavioral health problem in
addition to the substance abuse problem. In addition, Medicaid-eligible
clients who have other behavioral health problems do not
need to be free of substance abuse problems before they can receive
medically necessary treatment. Finally, the full array of behav-ioral
health services, including respite-like care and residential
detoxification (not including room and board), can be paid for by
Medicaid, as long as the services are medically necessary and
provided in a Medicaid-compatible setting. In spite of this, a
RBHA denied services to Maria, a pregnant teenager currently in
the Child Protective Services (CPS) system. She was seeking
residential drug treatment, but was denied because she did not
have another behavioral health diagnosis. Similarly, Rachel is a
seriously mentally ill woman currently on probation. She is re-ceiving
methadone for her heroin addiction, but has been told
she must get off methadone before she can receive any other
substance abuse services to address her problems with alcohol
and other substances.
In addition to RBHA officials and providers being confused
about Medicaid coverage for services, the courts and Juvenile
Corrections may not always know whether the person they are
referring for services is enrolled in Medicaid. This can result in
treatment delays or denials, since the behavioral health care sys-tem
has limited monies to treat people who are not entitled to
Medicaid services.
BHS has initiated efforts to ensure that clients with substance
abuse as well as other mental health problems receive treatment.
Nonetheless, the Division should take further actions to diminish
confusion and ensure that clients receive Medicaid-covered
services. Specifically, BHS policies governing the services pro-vided
by RBHAs should be revised to clearly specify all the
services that are covered by Medicaid. In addition, BHS should
approach the Arizona Health Care Cost Containment System
(AHCCCS) about changing the capitation structure because it
appears to contribute to some confusion over whether Medicaid
clients can receive substance abuse treatment. Currently, a differ-ent
capitation rate category exists for “general mental health and
substance abuse,” which may inappropriately imply that chil-
Maria, a pregnant teenager
currently in the CPS system,
was denied residential drug
treatment.
Summary
OFFICE OF THE AUDITOR GENERAL
v
dren and adults with serious mental illness are not eligible to
receive substance abuse services.
To address confusion over enrollment, the courts and the De-partment
of Juvenile Corrections should adopt methods of de-termining
whether probationers or parolees are eligible for and
enrolled in Medicaid and KidsCare. These determinations
should be made before making referrals to the RBHAs.
Changes Could Enhance
Ability to Secure
Specialized Services
(See pages 33 through 38)
Even when there are no disagreements between agencies, audi-tors’
case studies showed that some referred clients may be un-able
to access needed services because the services are simply
unavailable. For example, Kristine, a young woman from a rural
area who has a developmental disability, needed a residential
placement upon her discharge from the Arizona State Hospital,
but the placements available near her home could not handle her
extensive needs. Although such problems appear most prevalent
in rural areas, some clients’ needs are difficult to meet even in
urban areas. For instance, Jake, another DDD client, was placed
in a partial care facility but his I.Q. score was too low for him to
benefit from that facility’s services. Other clients may be rejected
by providers due to disruptive behaviors or other issues. For
example, Joseph is a homeless man who is currently on proba-tion
and who has a serious mental illness. He apparently was
rejected by a provider for treatment because of his past felony
drunk-driving conviction.
While gaps in service availability will likely continue, particu-larly
for sex offenders, AHCCCS and BHS could make some
changes that would help to increase service availability.
n First, BHS can continue its efforts to encourage RBHAs to
contract with providers for difficult-to-find services by in-forming
them that provider contract rates are flexible, al-lowing
the RBHAs to pay higher rates when necessary.
Joseph, a homeless man with
a serious mental illness, was
rejected by a residential
treatment center because of a
felony drunk-driving condi-tion.
Summary
OFFICE OF THE AUDITOR GENERAL
vi
n Second, BHS could ensure that at least some of the RBHAs’
providers accept difficult or disruptive clients as a condition
of their contracts, in exchange for higher provider fees or
other incentives.
n Finally, AHCCCS could request approval from the Health
Care Financing Administration to let RBHAs contract with
certified substance abuse counselors and master’s-level indi-vidual
providers, such as social workers and therapists, certi-fied
through the State’s Board of Behavioral Health Examin-ers.
Currently, RBHAs can contract only with physicians,
nurse practitioners, physician assistants, psychologists, and
licensed provider facilities.
Expanding BHS’ Role in
Serving Juvenile Offenders
Could Save the State Money
(See pages 39 through 42 )
State dollars could be saved if services for Medicaid-eligible ju-veniles
were provided through BHS and the RBHAs, instead of
being provided by the juvenile justice system. Currently, the
Department of Juvenile Corrections and the juvenile and adult
probation systems pay out of their own state-funded dollars to
treat juvenile sex offenders who are on parole or probation. Ac-cording
to Juvenile Corrections and the courts, these agencies use
their own funding rather than referring these clients to the be-havioral
health system, since the RBHAs have refused to provide
such services in the past. In addition, Juvenile Corrections cur-rently
pays for residential treatment for juveniles who are re-moved
from correctional facilities to receive behavioral health
treatment. In both cases, such services for Medicaid-enrolled
individuals could be paid for by the behavioral health system
with Medicaid dollars, which are provided largely by the federal
government. In order to conserve state dollars and effectively
leverage federal Medicaid dollars, the Division should ensure
that the RBHAs are made responsible for providing medically
necessary behavioral health care to juvenile sex offenders and
Medicaid-eligible prisoners removed from prison for treatment.
Summary
OFFICE OF THE AUDITOR GENERAL
vii
Other Pertinent Information
(See pages 43 through 54)
During the audit, other pertinent information was collected re-garding
previous efforts undertaken to improve service provision
for people involved with the behavioral health system and other
state agencies. Since 1986, numerous studies and other efforts
have been initiated to improve coordination of these services.
Studies by legislative committees and private foundations have
identified problems with fragmentation, redundancy, and inap-propriate
service delivery. To resolve these problems, suggested
solutions have ranged from an overall redesign of the way serv-ices
are delivered to more specific procedural improvements, such
as changing the amount and type of information collected from
shared clients. Specifically, the groups have recommended:
n Streamlining the service delivery system by using a central-ized
screening process, creating local family assistance service
centers, and integrating case management by assigning a sin-gle
case manager to serve interagency clients;
n Providing a full continuum of specialized services for specific
populations;
n Improving communication among agencies by establishing
local councils, an interagency cabinet, and multi-agency teams;
n Improving information sharing among agencies by creating a
central information system, a common database or data ware-house,
developing data-sharing links, and avoiding collecting
redundant information;
n Providing more timely, complete, and accurate assessments by
incorporating a developmental and long-term view, adopting
similar guidelines, and using a common screening process;
and
n Using funding more efficiently, by exploring ways to make
funding more flexible, expanding an existing joint agreement
for the purchase of provider services, establishing a mecha-nism
to ensure sufficient funding, and maximizing the use of
federal funds.
OFFICE OF THE AUDITOR GENERAL
viii
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OFFICE OF THE AUDITOR GENERAL
ix
TABLE OF CONTENTS
Page
Introduction....................................................... 1
Finding I: Managed Care Focus, and
Structure That Divides Responsibility,
Leads to Interagency Disagreements......... 11
System’s Inherent Vagueness
Leads to Disagreements ................................................. 11
Changes Could
Diminish Some Disagreement ....................................... 16
Recommendations .......................................................... 21
Finding II: Confusion Exists
Regarding Medicaid Coverage ......................... 23
Medicaid Covers a Wide
Range of Services ............................................................ 23
Coverage for Substance Abuse,
Other Services Misunderstood....................................... 25
Enrollment Another
Source of Confusion....................................................... 29
Lack of Clarity Has
Several Effects ................................................................. 29
Several Changes Should Be Made
to Ensure That Clients
Receive Entitled Services................................................ 30
Recommendations .......................................................... 32
Table of Contents
OFFICE OF THE AUDITOR GENERAL
x
TABLE OF CONTENTS (cont’d)
Page
Finding III: Changes Could
Enhance Ability to Secure
Specialized Services.................................... 33
Services Not
Always Available to
Entitled Clients................................................................ 33
Changes Could Make
Services for Special-Needs
Clients More Available................................................... 36
Recommendations .......................................................... 38
Finding IV: Expanding BHS’ Role in
Serving Juvenile Offenders
Could Save the State Money....................... 39
BHS Plays Limited Role in Providing
Services for Juvenile Offenders ...................................... 39
Shifting Medicaid-Eligible Juveniles to
Behavioral Health Services System
Could Help Stretch State Dollars ................................... 41
Making Such a Change Would
Require a Shift in Responsibility .................................... 41
Recommendations .......................................................... 42
Table of Contents
OFFICE OF THE AUDITOR GENERAL
xi
TABLE OF CONTENTS (concl’d)
Page
Other Pertinent Information ............................. 43
Coordination Problems
Among Agencies Identified ........................................... 43
Similar Recommendations Made
to Improve Service Coordination................................... 45
Agency Response
Exhibit and Table
Exhibit 1 AHCCCS and ADHS
Division of Behavioral Health Services
Behavioral Health Services
Covered by Medicaid ................................... 24
Table 1 Behavioral Health Services
Efforts to Improve Coordination
of Behavioral Health Services ...................... 52
OFFICE OF THE AUDITOR GENERAL
xii
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OFFICE OF THE AUDITOR GENERAL
1
INTRODUCTION AND BACKGROUND
The Office of the Auditor General has conducted a performance
audit of the coordination and provision of behavioral health
services among selected state agencies, in response to an October
6, 1998, resolution of the Joint Legislative Audit Committee. The
audit was conducted under the authority vested in the Auditor
General by Arizona Revised Statutes (A.R.S) §41-1279. A sepa-rate
review of the Division of Behavioral Health Services was
issued in July 1999 (Report No. 99-12).
The Division of Behavioral Health Services (BHS) within the
Department of Health Services is responsible for providing pub-licly
funded behavioral health services in Arizona. BHS provides
services to persons with a wide variety of behavioral health
problems, ranging from adults with depression, schizophrenia,
or substance abuse problems to children with attention-deficit
hyperactivity disorder and post-traumatic stress disorder.
History and Evolution of the Audit
Although BHS is responsible for providing publicly funded be-havioral
health services in Arizona, long-standing disputes have
revolved around whether clients served by other public agencies,
such as the courts and the Department of Economic Security, can
access all behavioral health services requested by the other agen-cies,
and whether such services are appropriate for clients’ needs.
During the 1990s, many different efforts, mostly focused on chil-dren’s
services, were launched to examine various aspects of the
coordination between the State’s behavioral health care system
and other state agencies. Several efforts were outgrowths of a
1991 Arizona Federal District Court case (JK v. Griffith, No. Civ
91-261) alleging that Medicaid-eligible children were not receiv-ing
adequate or appropriate behavioral health care.
Disputes have revolved around
whether clients can access all
behavioral health services
requested by other agencies.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
2
These previous efforts addressed a wide variety of issues related
to coordination of services among state agencies. Recommenda-tions
were made to address problems such as duplication of
efforts and poor communication among agencies. (Other Perti-nent
Information, pages 43 through 54, describes the efforts and
recommendations more fully.) While some of these efforts
showed that clients referred from other state agencies do not
always receive appropriate or adequate services, these other
efforts did not focus on why clients referred to the behavioral
health system may not always receive the services other state
agencies believe they need.
This audit attempts to develop explanations for why people
referred for behavioral health services cannot always access re-quested
services, or receive more limited treatment than other
agencies believe to be necessary. It makes recommendations
pertaining to how the State might improve service accessibility
for people referred to the behavioral health system, and ensure
that the duration and level of care provided are appropriate.
To identify common themes explaining why clients from other
agencies cannot always access requested services, auditors ex-amined
the problems encountered in providing services to peo-ple
such as the following:
Irene
Irene has cerebral palsy and requires a
wheelchair to get around. Although at
one time she lived in her own apart-ment
while attending community
college, she has been hospitalized for
major depression with psychotic fea-tures
and is now under a court order to
receive behavioral health services.
However, the State’s behavioral health
care system has had difficulty supply-ing
these services, because Irene must
have a wheelchair-accessible facility
where staff has the necessary training
to assist her with both her physical and
behavioral health needs.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
3
RBHAs—Do not receive
fees for services, instead
they receive a fixed dollar
amount per eligible person
per month.
Behavioral Health Services in Arizona
This introduction describes how the study was conducted and
how its findings are presented. It also provides an overview of
how the State’s behavioral health services delivery system is
organized.
Division of Behavioral Health Services provides services
through Regional Behavioral Health Authorities—Arizona Re-vised
Statutes (A.R.S.) §36-3403
requires the Division of Behav-ioral
Health Services to
administer a unified mental
health program, including the
state hospital and community
mental health. To carry out this
charge, BHS oversees a managed care system administered by
five contracted organizations called Regional Behavioral Health
Authorities (RBHAs). The RBHAs are similar to health mainte-nance
organizations in that they do not receive fees for services.
Instead, they receive a fixed dollar amount per eligible person
per month (a capitated rate) for Medicaid and KidsCare clients,
Maria
Maria is a 17-year-old with numerous
behavioral health problems. Physically
and sexually abused as a child, she was
hospitalized for suicidal tendencies at
the age of 13. Over one year later, ad-dicted
to crack cocaine and other sub-stances,
she gave birth to her first child,
who was born medically impaired. At
16, she was pregnant again. Although
Maria met eligibility requirements for
state-provided drug-treatment services,
she had difficulty obtaining them.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
4
and a fixed amount for serving clients who do not quality for
these two programs. RBHAs in turn contract with more than 350
service providers to provide the actual services.
The Division of Behavioral Health Services, through its RBHAs,
is responsible for providing services to several categories of enti-tled
clients.
n The Division is responsible for supplying medically neces-sary
behavioral health services to Medicaid clients in the
State through a contract the Division has with the Arizona
Health Care Cost Containment System (AHCCCS).
n BHS is also responsible for providing services to develop-mentally
disabled Arizona Long Term Care System (ALTCS)
recipients through a contract it has with the Department of
Economic Security’s Division of Developmental Disabilities
(DDD).
n Furthermore, the Division of Behavioral Health Services is
responsible for providing all needed behavioral health serv-ices
and additional services, such as vocational services and
housing, to adults with serious mental illness (SMI), regard-less
of their Medicaid status. This latter requirement is out-lined
in A.R.S. §36-3407, and is currently enforced under a
court order for persons living in Maricopa County, based on
the Arnold v. Sarn lawsuit.
The Division of Behavioral Health Services is also responsible for
providing care to KidsCare recipients. Under this program, eligi-ble
children can receive a total of 30 days of inpatient and 30
units of outpatient behavioral health services. Finally, the Divi-sion
also provides services to other persons who do not qualify
for Medicaid, ALTCS, or KidsCare, as funding allows.
Other agencies’ involvement with the Division—Many of the
clients involved in the behavioral health system have multi-agency
involvement. These mutual clients are often referred to
the RBHAs for services by the other state agencies serving them.
These other state agencies include:
n Division of Developmental Disabilities (DDD)—A unit of
the Department of Economic Security, this agency is respon-
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
5
sible for about 17,000 persons with developmental disabilities
such as mental retardation, cerebral palsy, and epilepsy. Of
these clients, over 10,000 are ALTCS enrollees.
n Child Protective Services (CPS)—Also a unit within the
Department of Economic Security, this agency served ap-proximately
33,000 families and provided out-of-home care
to approximately 6,700 children and youth in fiscal year 1998.
CPS investigates allegations of child abuse and neglect, pro-vides
in-home family support and preservation services, and
provides foster care and other services for children removed
from their families.
n Department of Juvenile Corrections—Juvenile Corrections
supervises 700 youth offenders. Each year, the Department
also supervises 2,500 youth on parole, and transitions these
youth back into the community once they are released from
one of the Department’s seven secure facilities.
n Administrative Office of the Courts—The Supreme Court’s
Administrative Office of the Courts administers statewide
adult and juvenile probation services, which are operated at
the individual county level. In 1998, adult probation offices
supervised approximately 35,000 probationers. During that
same year, juvenile probation offices supervised 9,000 proba-tioners.
Additional agencies also refer clients to the RBHAs for behav-ioral
health treatment. These agencies include AHCCCS, whose
clients may be referred to the RBHAs through contracted medi-cal
care providers, and the Department of Education, whose
students may be referred to the behavioral health care system by
individual school districts.
Although agencies often do refer clients to the behavioral health
care system for treatment, this is not always the case. Sometimes,
other state agencies pay for behavioral health services them-selves.
In interviews conducted with other agency officials, they
noted that referrals usually are not made if clients are not eligible
for Medicaid. In addition, other state agencies often do not refer
clients for behavioral health treatment when Medicaid does not
cover a service that the agency or a court order deems appropri-ate
for the client. Further, these agencies (particularly Juvenile
Corrections) may not refer clients for services if the agency has
Sometimes other state
agencies pay for behavioral
services.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
6
had historic difficulties accessing such services. (See Finding IV,
pages 39 through 42).
Other state agencies also pay for behavioral health services for
clients who are referred but not able to access services deemed
necessary by the referring agency. In still other cases, the RBHAs
and other state agencies share the costs of providing services. For
example, the Department of Economic Security’s Child Protec-tive
Services may pay for room and board costs associated with a
child residing in a therapeutic group home, while BHS pays for
the behavioral health services provided at the facility. According
to agency officials at the Department of Economic Security, the
Department of Juvenile Corrections, and BHS, the use of such
cost-sharing agreements has increased dramatically over the past
two years. BHS and other state agencies regard such agreements
as holding great promise for reducing interagency disputes.
Other state agencies’ spending on behavioral health services
appears to vary in magnitude. For example, the Department of
Economic Security’s Division for Children, Youth, and Families
expended approximately $11 million and the Department of
Juvenile Corrections over $2 million for behavioral health serv-ices
in fiscal year 1999. DDD spent approximately $100,000 in
non-ALTCS monies. BHS spent approximately $308 million in
Medicaid, KidsCare, and all other monies on behavioral health
services during that same period.
Audit Scope and Methodology
To assess the coordination of behavioral health services among
state agencies, the audit focused on determining reasons why
clients referred by other state agencies for services do not always
receive services through the RBHAs. To do so, a combination of
audit methods was used. However, the central method of this
audit was conducting in-depth case studies.
Case study method—A case study is a method for learning about
a complex instance, based on a comprehensive understanding of
that instance obtained by extensive description and analysis of
The use of cost-sharing
agreements has increased
dramatically.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
7
that instance taken as a whole and in its context.1 Recently, case
studies have gained increased attention for the value they have
in exploring the reasons behind problems common to complex
organizations. A congressional committee, for example, used a
case study approach in 1991 to study fraud and abuse in the
insurance industry in order to determine causes of insurance
company failures. In this audit, case studies were used to dis-cover
explanations for disagreements between agencies regard-ing
services for referred clients, and to determine what appropri-ate
actions can be taken.
Case studies can be used for a variety of purposes. They have
been used primarily to isolate complex causal elements, as they
were used in this audit. They can also be useful to compare
across various sites, such as the various agencies making refer-rals
to the RBHAs. The benefits of case studies include their abil-ity
to encompass the context in which events occur, as well as the
small but significant differences that can be obscured in large-scale
statistical analysis. Thus the case study was an ideal
method to provide information and explanation for some of the
problems identified in the many previous studies of Arizona’s
behavioral health system.
For the audit, ten individuals in the behavioral health care sys-tem
were selected as case studies. The group of ten, which in-cludes
both adults and children, all met three basic criteria:
n They were clients who entered the behavioral health care
delivery system through agencies other than BHS.
n They either were eligible for Medicaid or were thought to be
eligible for Medicaid when they entered the system.
n They had difficulty in obtaining needed services.
1 United States General Accounting Office, Case Study Evaluations,
GAO/PEMB-91-10.1.9, November 1990 (page 15).
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
8
Clients selected for the case-study review came from DDD, CPS,
Juvenile Corrections, and the Administrative Office of the
Courts.1
After identifying and selecting cases, auditors used a structured
protocol to review documentation from numerous sources, in-cluding
referring agency files, RBHA files, and records regarding
Medicaid eligibility. To ensure they had a clear picture of the
treatment histories, auditors also interviewed multiple people
who were familiar with each case, including RBHA case manag-ers,
officials from referring agencies, and service providers to
determine why clients were not able to receive needed services.
Supplementary methods—To supplement this case-study ap-proach
with a broader review that would help set the findings in
context, auditors also conducted the following work:
n Reviewing reports by legislative committees, multi-agency
councils, nonprofits, and experts on coordination problems
between state agencies and BHS;
n Interviewing Health Care Financing Administration and
AHCCCS officials;
n Attending work groups on coordination problems between
agencies;
n Examining intergovernmental agreements, protocols, estab-lished
guidelines, policies, rules, and statutes related to be-havioral
health service delivery;
n Examining entitlement requirements for behavioral health
services;
n Reviewing the State’s Medicaid plan and BHS’ strategic plan
for substance abuse provision;
1 Time constraints and limited audit resources did not permit drawing
cases from all possible referring agencies or from every RBHA. Also,
time constraints limited the review of probationers from the Admin-istrative
Office of the Courts to adult probationers, although some
Juvenile Corrections cases reviewed also contained information on
clients’ experiences in the juvenile probation system.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
9
n Interviewing representatives and conducting focus groups to
solicit the views of mental health advocates, providers, and
agency representatives;
n Reviewing literature on medical necessity definitions, rural
behavioral health care, and behavioral health treatment and
diagnosis;
n Examining BHS service matrixes and service authorization
codes; and
n Reviewing information provided by the Department of
Health Services’ Division of Assurance and Licensure on
changes in licensed providers.
The audit contains three findings on reasons why clients referred
by other agencies cannot always access services from the behav-ioral
health system, and recommendations on changes needed
to make the system more accessible. Specifically, the findings
discuss:
n Issues related to the behavioral health system’s design that
affect the ability of referred clients to access some services
(see Finding I, pages 11 through 21);
n Uncertainty about who is eligible to receive Medicaid-provided
services and about which services Medicaid will
provide (see Finding II, pages 23 through 32); and
n Lack of provider services for some clients (see Finding III,
pages 33 through 38).
The report also contains a fourth finding, pertaining to possible
savings of state dollars if BHS takes a greater role in providing
services to juvenile offenders, parolees, and probationers (see
Finding IV, pages 39 through 42). Finally, the report contains
Other Pertinent Information on the numerous studies and work
groups formed in recent years to review issues related to the
coordination of behavioral health services across agencies, and
common recommendations from these work groups. (See Other
Pertinent Information, pages 43 through 54.)
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
10
Audit Limitations
While this audit focused on why clients referred by other state
agencies are not always able to access services from the behav-ioral
health system, it could not determine how frequently clients
cannot receive requested services. At the time of the audit, the
Division of Developmental Disabilities, Juvenile Corrections,
county adult probation offices, and Child Protective Services did
not track cases referred to the behavioral health system for serv-ices.
As a result, auditors could not estimate the frequency at
which such denials occur. Nonetheless, previous independent
evaluations of the care that behavioral health clients receive have
noted instances where clients with multiple agency involvement
did not receive adequate services.
This audit was conducted in accordance with government
auditing standards.
The Auditor General and staff express appreciation to the Acting
Director of the Department of Health Services, the Assistant
Director of the Division of Behavioral Health Services, and offi-cials
at the Department of Juvenile Corrections, the Department
of Economic Security, the Administrative Office of the Courts,
and county probation offices for their cooperation and assistance
throughout the audit.
OFFICE OF THE AUDITOR GENERAL
11
FINDING I MANAGED CARE FOCUS, AND
STRUCTURE THAT DIVIDES
RESPONSIBILITY, LEADS TO
INTERAGENCY DISAGREEMENTS
The managed-care focus and multi-agency structure of Arizona’s
behavioral health care system is inherently vague and leads to
conflict over whether clients referred by other agencies should
receive care from the Division of Behavioral Health Services
(BHS). The managed-care system provides some incentive for
limiting care and mandates that services be provided only when
“medically necessary,” a concept that is vague and open to dis-pute.
Blurred roles among agencies and the potential for other
agencies to pay for services that BHS does not provide also lead to
disputes over which agency should provide services to clients.
Auditor General staff identified three options that could help
mitigate some of these sources of dispute:
n Eliminating some of the divided responsibility among agen-cies;
n Improving and standardizing assessments of behavioral
health clients’ conditions; and
n Improving oversight of services provided by Regional Behav-ioral
Health Authorities (RBHAs).
System’s Inherent Vagueness
Leads to Disagreements
After examining the case studies in depth, interviewing agency
officials and other interested parties, and examining the results of
other recent study efforts, three primary factors emerged as con-tributing
to interagency disagreements. The first is the system’s
managed-care focus, which provides some incentive to limit care
and control costs. The second factor, which naturally follows the
first, is that the behavioral health system is focused on providing
only “medically necessary” services, which is a requirement for
coverage under the federal Medicaid program. The concept of
Finding I
OFFICE OF THE AUDITOR GENERAL
12
“medical necessity” is inherently vague and open to conflict. Fi-nally,
divided responsibilities and funding create incentives for
cost-shifting between agencies.
Managed care system creates some incentive to limit care—Ari-zona’s
managed behavioral health care system creates some in-centive
for the RBHAs and/or their providers to limit care, thus
contributing to conflict between agencies.1 Officials and case man-agers
from other agencies and providers often stated in interviews
that services provided by the RBHAs were too limited in duration
or intensity to meet clients’ needs. It was alleged that efforts by the
RBHAs to continually review and authorize services would
sometimes cut off services prematurely or inappropriately. Also,
representatives from another agency said that the RBHAs provide
only a limited scope of services, when a fuller array of services
would appear to be justified.
The State’s behavioral health care system does indeed limit the
duration and scope of services. State law has established a system
of health care in Arizona designed to control costs. 2 Accordingly,
BHS/RBHA contracts require the RBHAs to ensure that services
are provided in the least restrictive settings possible. For example,
a client should not be confined in a psychiatric hospital if he or she
can be treated equally well as an outpatient. In addition, the sys-tem
for funding behavioral health services in this State creates
some incentive to limit care. The RBHAs are paid a fixed sum of
money in advance for serving Medicaid-eligible people in their
geographic region, and incur a loss if they spend more than they
receive. As a result, RBHAs protect their limited funds by moni-toring
service utilization, requiring authorization for services be-yond
pre-defined limits, and denying services when the need for
1 In some cases, the RBHAs share the risk of providing services with
their contracted providers. The Community Partnership of Southern
Arizona and the Northern Arizona Regional Behavioral Health
Authority each pay their contracted providers in advance for pro-viding
all services to a defined number of clients.
2 See A.R.S. §§36-2903, 36-2907, and 36-2989.
RBHAs are required to ensure
that services are provided in the
least restrictive setting.
Finding I
OFFICE OF THE AUDITOR GENERAL
13
Medical Necessity—How Is It Defined?
In BHS’ most recent RBHA contract, medically neces-sary
covered services are defined as services that are:
n Provided by the practitioners within the scope of
their practice to prevent disease, disability, and/or
other adverse health conditions or their progres-sion;
n Promoting progress toward the highest possible
level of health and self-sufficiency;
n Reasonably expected to benefit the eligible person’s
mental or physical health;
n Necessary and appropriate to the eligible person’s
present condition;
n Designed to assist eligible and enrolled persons to
manage their illness to the extent possible and to
live, learn, and work in their own communities.
The contract further states that a “covered service is
medically necessary if there is no equally effective
service that is less restrictive or substantially less costly.
Services shall not be denied based on ‘medical neces-sity’
solely because the enrolled person has a poor
prognosis or has not shown improvement if the cov-ered
services are necessary to prevent regression or
maintain their present condition.”
services is unclear or when it appears that another agency could
provide the service. 1
While the State’s behavioral health care system is designed to
control costs, it is questionable whether it is limiting services so
much that the care delivered is sometimes inappropriate in type
or duration. Because auditors reviewed a limited number of cases
referred for services by other agencies, it was impossible to con-clusively
answer this question. However, other studies performed
recently do suggest that care may sometimes be inappropriately
limited for clients referred from
other agencies to the State’s be-havioral
health care system. An in-depth
independent review of
Maricopa County’s behavioral
health system for Medicaid chil-dren
performed in 1998 as part of
the JK v. Griffith lawsuit noted:
“(The) current service pattern is to
under-serve children by delivering
episodic treatment and crisis
services even though…a more
comprehensive and continuous
intervention strategy is required to
prevent harm and achieve satisfac-tory
results.”
The study also found that
underservice was especially pro-nounced
for children involved with
the juvenile justice, developmental
disability, and child welfare
systems. Children with
developmental disabilities received
the least acceptable services of
these groups.
1 Some of the incentive to limit care is mitigated by BHS/RBHA con-tractual
clauses that allow the Division to adjust capitation rates or
payments to the RBHAs if losses are too great. Further, contractual
limits on the amount of profit that can be realized by the RBHAs
further guard against underservice.
Finding I
OFFICE OF THE AUDITOR GENERAL
14
Medical necessity often the source of denials, disputes—To help
control costs, each RBHA is required by contract with BHS and by
Medicaid rules to deliver only those services that are “medically
necessary,” meaning that services must be expected to benefit the
client’s mental or physical health, and should be delivered in the
least restrictive setting proven or predicted to be effective in
meeting the clients’ behavioral health needs in order to conserve
costs. The different opinions among RBHAs, the courts, and state
agencies over which services are medically necessary appear to be
a common reason for disputes over services received by clients
who have been referred by other agencies. “Medical necessity” is
defined quite broadly in this State (see highlighted information on
page 13), allowing the RBHAs much discretion in interpreting the
medical necessity of individual services. While this broad defini-tion
may result in differences of opinion regarding whether serv-ices
are medically needed, it also appropriately allows an array of
services to be covered under Medicaid reimbursement.
In many of the reviewed cases, disagreements centered on a
RBHA’s decision to terminate or refuse to approve behavioral
health treatment because the service was not deemed “medically
necessary.” These disputes frequently occur regarding continued
placements in costly residential treatment settings. Representa-tives
from other state agencies often disagreed with the RBHA’s
interpretation. For example:
Todd
Todd, a 15-year-old client with aggressive, hyperactive behaviors,
had his services terminated at a residential treatment center after
eight weeks. The RBHA stated that out-of-home treatment was no
longer medically necessary. Todd’s court-appointed psychiatrist
and his CPS caseworker believed he needed intense treatment in a
confined setting, such as the residential treatment center, because
he was in danger of fleeing and because of his conflicts with staff at
group homes where he had stayed in the past. They said it was
inappropriate for him to receive care at home due to problems
with his family. The psychiatrist assigned to Todd by the RBHA
disagreed, saying that because he did well when removed from
his family and placed in a confined setting, problems with his
parents and inappropriate foster care placements may explain his
behavior. In the RBHA psychiatrist’s opinion, treatment was
needed, but placing Todd in the residential treatment center did
not meet “medical necessity.”
Finding I
OFFICE OF THE AUDITOR GENERAL
15
Multiple funding streams create opportunities for cost-shifting—
Although the Division is the primary agency responsible for pro-viding
publicly funded behavioral health services, other agencies
sometimes purchase behavioral health services for their Medicaid-eligible
clients, raising questions about who should pay for a par-ticular
service.1 RBHAs can reduce their spending if they transfer
payment responsibility to another agency. In one of the ten cases
auditors reviewed in detail, the RBHA appeared to inappropri-ately
be attempting to shift the costs of behavioral health treat-ment
to another agency:
Interviews with behavioral health professionals confirm that
cost-shifting sometimes occurs. For example, a RBHA psychia-trist
indicated that children who have conduct disorders or who
have committed sexual offenses and are referred to the RBHA
for possible Medicaid-provided care are traditionally shifted to
other agencies because the other agencies have money to pay for
treatment.
1 The Division currently receives federal- and state-appropriated
dollars to provide behavioral health services to Medicaid-eligible
members of AHCCCS health plans. Medicaid dollars are received
through the Division’s contract with AHCCCS, Arizona’s designated
Medicaid agency. Arizona Long Term Care System dollars for
ALTCS-eligible Developmental Disabilities clients are also received
directly from AHCCCS. BHS provides services for DDD ALTCS cli-ents
through an interagency agreement between DDD and BHS.
Irene, a 25-year-old developmentally
disabled client, was referred by the
Division of Developmental Disabilities
(DDD) for services to be provided
through a RBHA. The RBHA denied
that Irene had a serious mental illness,
stating that Irene’s problems were due
to mental retardation, not depression.
When RBHA staff learned that Irene
did not have mental retardation, they
asserted that her behavioral health
problems were due to cerebral palsy.
Irene
Finding I
OFFICE OF THE AUDITOR GENERAL
16
Habilitative Treatment—
care that brings clients to a
new, higher level of func-tioning.
Rehabilitative Treatment—
care that restores clients to
their former level of func-tioning.
In some cases, disputes over who should pay may also be attrib-uted
to narrow and unclear distinctions between agencies’ roles.
For example, one high-level
DDD administrator explained
that DDD provides habilitative
treatment for its clients, while
RBHAs are responsible for pro-viding
rehabilitative treatment.
The administrator admitted that
it can be very difficult to distin-guish
the difference between a
client’s needs for habilitative
versus rehabilitative services. Interviews, case studies, and lit-erature
also suggest that the distinction between a developmen-tal
disability and a behavioral health problem can be difficult to
distinguish.
Changes Could
Diminish Some Disagreement
Changes in the current behavioral health delivery system could
eliminate some of the disputes between agencies and result in
more accessible, appropriate, and integrated treatment for indi-viduals.
Specifically, improvements may occur by:
n Transferring responsibility for some clients’ behavioral health
services from BHS to DDD.
n Revising RBHA and other agencies’ assessment practices.
n Enhancing BHS’ oversight of the RBHAs to help ensure that
treatment for interagency clients is appropriate in type and
duration.
Transferring responsibility could eliminate some conflict— By
allowing some other agencies to contract directly with provid-ers
for the behavioral health treatment for their Medicaid cli-ents,
interagency conflict could be diminished. Although other
groups of clients with multi-agency involvement might also
benefit from carving out treatment, this could most easily occur
for DDD clients in the Arizona Long Term Care System
(ALTCS). Currently, DDD has an intergovernmental agreement
Finding I
OFFICE OF THE AUDITOR GENERAL
17
with BHS to provide behavioral health services for such clients
through the RBHAs. Because of this separate capitation rate set
by AHCCCS and an existing information system for reporting
DDD/ALTCS services to AHCCCS, DDD would need to make
fewer changes in its administration and contract monitoring
practices than other agencies might need to make.
“Carving out” DDD/ALTCS clients from the behavioral health
system may make sense for other reasons, too. Differences be-tween
problems associated with a client’s developmental dis-ability
versus any diagnosed behavioral health problems can be
difficult to determine. Indeed, an independent study of Medi-caid
service provided to children in Maricopa County for the JK
v. Griffith lawsuit stated:
“A developmental disability is a life-long condition while a
mental illness may be episodic and controllable with medica-tions.
Each diagnosis requires supports, services and treatments
that are appropriate and effective for each condition—the first
using a developmental, supportive approach and the other using
an interventive, therapeutic approach. These dual requirements
are difficult to manage across the boundaries of different state
agencies.”
Finally, transferring responsibility for the provision of behav-ioral
health care back to DDD for its ALTCS clients makes sense
for these more than other agencies’ clients for another reason.
The independent study noted above pointed out that DDD
children eligible for Medicaid are the least likely among groups
of children with multi-agency involvement to receive appropri-ate
treatment from the behavioral health system.
Transferring responsibility was discussed seriously in 1994-
1995 by BHS, DDD, and AHCCCS. A joint task force met sev-eral
times to develop a plan for transferring DDD clients who
were eligible for ALTCS from BHS to DDD for their behavioral
health services. An internal study by DDD had found that its
ALTCS clients were more likely to be denied services by the
RBHAs than other DDD clients. However, a pilot project
scheduled to begin on October 1, 1995, was never implemented.
Because such a transfer could make behavioral health services
more available to DDD ALTCS clients, the transfer could result
Finding I
OFFICE OF THE AUDITOR GENERAL
18
in increased costs to the State. Currently, DDD estimates that
almost 18 percent of its ALTCS clients receive behavioral health
services. In the 1995 study, DDD estimated that if it provided
behavioral health services to its ALTCS clients, 30 percent of its
ALTCS clients would utilize services. Although costs might
increase if service use grows, accurately projecting the in-creased
cost to the State would require an actuarial study simi-lar
to those conducted to prepare for Medicaid capitation rate
negotiations with the Health Care Financing Administration. If
the Legislature favors the transfer of responsibility in principle,
it could authorize DDD, BHS, and/or AHCCCS to contract
with an actuarial firm for such a study.
Changing assessments—By changing the way that clients’ con-ditions
are assessed by other state agencies and BHS, disputes
over whether a client is suffering from a behavioral health prob-lem
could be diminished. Other agencies sometimes perform
their own assessments of clients’ behavioral health problems and
needs. However, these assessments are performed in different
ways depending on the agency completing them, potentially
resulting in diverging opinions of clients’ conditions and treat-ment
needs. This often occurs with individuals who are involved
with the courts, and are court-ordered for a psychiatric evalua-tion.
While the courts and their contracted psychiatrists may
determine that an individual suffers from a particular behavioral
health problem and needs certain types of treatment, the RBHAs
are under no obligation to provide such treatment and may
reach different conclusions regarding the referred client’s condi-tion
and needs.
A group established out of the JK v. Griffith litigation is proposing
that children’s agencies cover a core set of assessment elements
and screening for other service needs when conducting initial
assessments. The group is recommending that this information
be available to all agencies. Such a procedure could also be modi-fied
and used by agencies conducting adult assessments.
The RBHAs’ use of more qualified medical health professionals
could also increase confidence in the RBHAs’ determinations of
whether clients referred for services have behavioral health
problems and whether services are medically necessary. Inde-pendent
studies performed in the past have found that RBHAs
do not always perform adequate assessments of clients’ condi-
Assessments are performed in
different ways depending on
the agency completing them.
Finding I
OFFICE OF THE AUDITOR GENERAL
19
tions, resulting in inaccurate diagnoses and incomplete treatment
plans. For example, in 1995, independent psychiatrists found in
their review of treatments delivered to Medicaid recipients that
there was “room for improvement in diagnostic accuracy.” The
same group formed out of the JK v. Griffith lawsuit, which is
recommending common assessment tools, also recommends that
more qualified people perform assessments.
Currently, BHS requires the Maricopa County RBHA to have
master’s-level behavioral health professionals perform assess-ments
and BHS is considering requiring other RBHAs to meet
such a requirement. However, interviews with officials from that
RBHA and others suggest that the RBHAs may find it difficult to
fulfill this requirement due to the expense and problems in re-cruiting
master’s-level caseworkers. BHS should assist the
RBHAs in developing a plan for fulfilling the current master’s-level
caseworker requirements, or develop alternative methods
of ensuring that those people who perform assessments are ade-quately
qualified.
BHS may also need to make changes to ensure that adults re-ferred
for services in the behavioral health system have adequate
time to submit medical records before medical professionals
determine whether the person is to be designated “seriously
mentally ill.” Currently, Arizona Administrative Code Title 9,
Chapter 21 states that persons seeking seriously mentally ill
status have seven days to submit medical records before a de-termination
is to be made. Such a narrow time frame may not be
long enough for people to obtain necessary medical records,
thereby limiting the RBHAs’ ability to review clients’ medical
histories and other psychiatrists’ opinions before making deter-minations
about whether an individual’s status can be classified
as “seriously mentally ill.”
Enhanced oversight of RBHAs—Greater oversight of RBHAs by
BHS could help ensure that services are not inappropriately de-nied
or limited. BHS has developed service guidelines outlining
care that clients should typically receive. Literature suggests that
such guidelines may be useful to prescribe typical client care and
to ensure that clients receive appropriate and sufficient services.
While individual care may differ from such guidelines, they
could be used to ensure that the majority of clients with specific
types of illnesses receive the treatment deemed appropriate by
Adequate time is needed to
submit medical records.
Finding I
OFFICE OF THE AUDITOR GENERAL
20
BHS. Maricopa County’s new RBHA contract actually requires
that services be delivered according to guidelines. However, it
appears from an interview with a Maricopa County RBHA
treatment team member that service guidelines are not con-sulted.
Also, the Division needs to carry out its plans to monitor
whether the care that people receive from the RBHAs mirrors
these service guidelines.
Also, BHS should better monitor whether RBHAs are making
appropriate decisions as to whether behavioral health clients
should be receiving inpatient hospital and other inpatient serv-ices
such as those provided in residential treatment centers. BHS
has developed level-of-care criteria outlining when clients
should receive intensive, costly inpatient and residential treat-ment.
Nonetheless, while such criteria have been developed, the
Division has not yet begun monitoring whether clients seeking
such care are receiving or being denied such services based on
the criteria.
Finding I
OFFICE OF THE AUDITOR GENERAL
21
Recommendations
1. The Legislature should consider directing DDD, BHS,
and/or AHCCCS to contract with an actuarial firm to deter-mine
the cost of having DDD contract directly with providers
for its ALTCS clients’ behavioral health services, instead of
relying on the RBHAs to deliver such services. If the Legis-lature
finds the projected cost to be acceptable, DDD should
begin directly contracting for such services for its ALTCS cli-ents.
2. BHS should continue to work with other agencies to develop
methods for streamlining and coordinating assessment of
children, as is currently occurring under the JK v. Griffith liti-gation.
BHS should also work with agencies that conduct
adult screening and assessments to ensure that the agency’s
assessment information is routinely available and incorpo-rated
into the RBHA’s assessment process.
3. BHS should assist the RBHAs in developing a plan for ful-filling
the current master’s-level assessment requirements, or
develop alternative methods of ensuring that people who
perform behavioral health assessments are adequately quali-fied.
4. BHS should make changes to Title 9, Chapter 21 of the Ad-ministrative
Code, allowing people applying for Seriously
Mentally Ill (SMI) status more time to submit medical records
so that past medical histories and other psychiatrists’ opin-ions
can be adequately considered.
5. BHS should monitor whether care delivered by the RBHAs
reflects the Division’s service planning guidelines.
6. The Division should monitor whether the RBHAs are cur-rently
using BHS level-of-care criteria when making deter-minations
as to whether clients qualify for inpatient and resi-dential
treatment.
OFFICE OF THE AUDITOR GENERAL
22
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OFFICE OF THE AUDITOR GENERAL
23
FINDING II CONFUSION EXISTS
REGARDING MEDICAID
COVERAGE
A second reason why some clients referred from other agencies
may not receive some services, apart from the systemic problems
described in Finding I (see pages 11 through 21), is that some
basic confusion exists about which services are available for
Medicaid recipients and who is covered by Medicaid. RBHAs
are denying some services, particularly for substance abuse,
because it is not clear if Medicaid covers services in certain cir-cumstances.
Also, some clients referred by the courts and Juve-nile
Corrections may not be receiving services because the refer-ring
agency assumes the client is enrolled in Medicaid when that
is not the case. This lack of clarity limits the degree to which
Medicaid recipients can obtain mental health treatment, and it
also shifts expenditures from Medicaid, which is largely funded
by the federal government, to programs funded entirely by the
State. To resolve the situation, BHS should clarify its policy about
which services Medicaid will cover. Changes in the capitation
rate structure could also help diminish confusion regarding who
is eligible to receive substance abuse services. The courts and
Juvenile Corrections should also take steps to ensure that their
personnel can identify people who are eligible for and enrolled
in Medicaid.
Medicaid Covers a Wide
Range of Services
In Arizona, Medicaid can pay for a wide range of services in a
variety of settings as long as these services are deemed “medi-cally
necessary.” These services range from inpatient hospital
services to professional services such as therapy and counseling,
to rehabilitation services such as assistance with daily living
activities and household services (see Exhibit 1, page 24). These
services are available to both children and adults. Further, these
services are available for people suffering from any type of be-havioral
health problems in which a person could benefit from
treatment, including substance abuse problems.
Finding II
24
OFFICE OF THE AUDITOR GENERAL
Exhibit 1
AHCCCS and ADHS Division of Behavioral Health Services
Behavioral Health Services Covered by Medicaid
INPATIENT SERVICES
¨ Hospital Services: Treatment of acute episodes, generally of a short duration, in an acute general hospital.
¨ Psychiatric Facility Services: The facility may be an inpatient residential treatment center or an inpatient psychiatric
hospital accredited by the Joint Commission on Accreditation of Health Care Organizations under inpatient standards.
Services in these facilities are covered only for persons under 21 years of age.
¨ Institution for Mental Disease (IMD) Services: Treatment includes medical attention, nursing care, and related
services. The facility may be a hospital, nursing facility, or other institution with more than 16 beds engaged in di-agnosing
and treating persons with mental diseases, including substance abuse/dependence. An institution for the
mentally retarded is not an institution for mental disease. IMD services are covered only for persons under 21
years old or 65 years and older.
PROFESSIONAL SERVICES
¨ Therapy and counseling: Individual therapy and group and/or family therapy and counseling provided by be-havioral
health professionals or behavioral health technicians.
¨ Psychotropic medication adjustment and monitoring: Review of effects and side effects of medication and adjustment
of dosages overseen by licensed medical professionals.
REHABILITATION SERVICES
¨ Basic Partial Care Services: A regularly scheduled therapeutic services program provided in a group. Services include
psychosocial rehabilitation, supportive counseling and other activities to promote coping, problem solving, and independ-ent
living and socialization skills to prevent placement in more restrictive settings.
¨ Intensive Partial Care Services: A regularly scheduled treatment program including individual, group and/or family
therapy, psychiatric services, and other therapeutic activities provided in a group setting under the direction of a psychia-trist
or psychologist to address acute or episodic behavioral health problems or to prevent placement in more restrictive
settings.
¨ Behavior Management Services: Therapeutic supervision and direction provided to prevent placement in a more restric-tive
setting. May include assistance with activities of daily living and household services.
¨ Psychosocial Rehabilitation: Treatment to develop community and daily living skills. Skill areas include attention and
concentration, interpersonal relations, socialization, understanding and use of medication, symptom management, use of
leisure time, and ability to use community resources.
¨ Emergency/crisis behavioral health services: Immediate and intensive, time-limited, community-based, face-to-
face crisis intervention services available on a 24-hour basis in situations where a person is a danger to self or
others.
OTHER SERVICES
¨ Screening and Evaluation Services
¨ Case Management Services
¨ Emergency and non-emergency transportation services
¨ Psychotropic medications
¨ Methadone administration
¨ Laboratory and radiology services
RESTRICTIONS ON TREATMENT SETTINGS
¨ Other non-hospital residential settings: Medicaid pays only for behavioral health services, not room and board
in non-hospital residential settings which are not IMDs when used to treat eligible persons age 21 through 64. Ex-amples
of non-hospital residential settings include: residential treatment centers; therapeutic group homes; inten-sive
adult residential; 24-hour supervised adult residential, semi-supervised independent living; 8-hour and 16-
hour facilities; substance abuse residential treatment centers; supported community living centers. Medicaid does
pay for room and board charges for children in residential treatment centers.
Source: Auditor General staff analysis of Arizona Administrative Code, Title 9, Chapter 22, Article 12. AHCCCS
Behavioral Health Rules; ADHS/DBHS Service Matrix, July 1999; and Value Options’ Integrated Behav-ioral
Health Services RFP, July 1999.
Finding II
OFFICE OF THE AUDITOR GENERAL
25
Coverage for Substance Abuse,
Other Services Misunderstood
While Arizona’s Medicaid program offers a wide range of serv-ices
to clients enrolled in Medicaid, actual delivery of such serv-ices
may be limited by confusion and lack of clarity over what
services are covered. In particular, confusion exists in four spe-cific
circumstances described below.
n Medicaid clients, such as seriously mentally ill adults,
adults with general mental health disorders who do not
meet SMI eligibility criteria, and children, are entitled to
receive substance abuse services—All Medicaid-eligible
clients are entitled to receive all medically necessary services,
including substance abuse treatment. However, according to
BHS’ medical director, confusion exists as to whether adults
who are enrolled as SMI clients can receive substance abuse
treatment, and whether children can receive substance abuse
treatment. Other high-level BHS officials also corroborated
this confusion.
BHS’ medical director suggested that at least two factors
contribute to the confusion:
4 Method of capitating Medicaid payments to the
RBHAs—Currently, different capitation funding catego-ries
exist for children, seriously mentally ill adults, and
adults suffering from general mental health or substance
abuse problems. According to the medical director, this
split may incorrectly imply that children or seriously
mentally ill adults are not eligible for substance abuse
services.
4 Structure of the provider network—Particularly in
Maricopa County, the structure of the provider network
may also contribute to confusion over whether seriously
mentally ill adult clients can receive substance abuse
services. Especially in Maricopa County, providers have
typically been identified as either providers for SMI
adults or substance-abusing adults. Little integration or
coordination occurs between substance abuse providers
and the providers of behavioral health treatment for the
seriously mentally ill. Therefore, people who have his-
Finding II
OFFICE OF THE AUDITOR GENERAL
26
torically been referred to a provider serving seriously
mentally ill adults may have been told that there was no
substance abuse treatment available for them. BHS and
the new RBHA in Maricopa County are planning to cre-ate
integrated networks of substance abuse and mental
health treatment providers, so that clients referred for one
type of treatment will be more easily referred to other
types of treatment. This is a part of a larger initiative the
Division has been undertaking over the past year to en-sure
the appropriate treatment of persons with substance
abuse and mental health problems.
n Substance abuse services alone can be provided to cli-ents
without an additional mental health diagnosis—It
appears that some RBHA staff incorrectly believe that Medi-caid
clients must be diagnosed with a mental health problem,
such as depression, to qualify for substance abuse services. A
senior-level community liaison at one RBHA stated that
Medicaid-eligible clients can receive mental health treatment
only if there is some evidence that a person’s mental health
problem exists aside from their substance abuse issues.
One of the audit’s case studies provides an example of this
situation:
Some RBHA officials incor-rectly
believe Medicaid clients
must be diagnosed with a
mental health problem to qual-ify
for substance abuse services.
Maria
Maria, a pregnant teenager who already had
one child, sought residential drug treatment in
December 1998. CPS initiated the service request
after taking custody of Maria’s first child, who
had medical problems including seizures and
blindness. The RBHA denied her treatment,
even though Maria was enrolled in Medicaid,
because they were under the impression that the
RBHA is not required to provide residential
substance abuse to anyone under the age of 21
who does not present any other mental health
diagnosis. Although the RBHA eventually
agreed to pay for residential treatment for sub-stance
abuse, the caseworker told Auditor Gen-eral
staff in August 1999 that she still did not
know if Medicaid funds cover treatment for
children who suffer only from substance abuse
and not other types of behavioral health prob-lems.
Finding II
OFFICE OF THE AUDITOR GENERAL
27
n Clients need not be free from substance abuse problems
before being eligible for other treatment—While some
RBHA staff incorrectly believe that substance abuse services
are not covered unless someone has another diagnosed be-havioral
health problem, others incorrectly believe that be-havioral
health treatment is not available for Medicaid-covered
clients unless the client is free from drug impair-ment.
In two Division-sponsored workshops on substance
abuse and mental illness in 1998, substance abuse providers
noted that mental health providers refuse services to clients
who are not “clean and sober.”
According to AHCCCS behavioral health rules, Medicaid-eligible
clients are entitled to receive any needed behavioral
health service. No requirement exists in Medicaid or
AHCCCS rules requiring clients to be drug-free to qualify for
behavioral health treatment. Providers may be confused
about whether clients need to be drug-free because non-
Medicaid-eligible adults, who may need to be designated as
SMI in order to receive state-funded services, may not be able
to obtain an SMI determination when their substance abuse
interferes with the RBHA’s ability to diagnose their mental
illness.
In addition to some believing that clients must be “clean and
sober” before being eligible to receive behavioral health
services, some RBHA providers and staff may incorrectly be-lieve
that clients who receive methadone treatment are not
eligible for other treatment. A representative from BHS’ Bu-reau
of Substance Abuse and General Mental Health noted
that some staff from provider agencies incorrectly believed
that people receiving methadone are not eligible for other
substance abuse treatment. The RBHA made such an incor-rect
assertion in Rachel’s case (see page 28).
Some RBHA officials incor-rectly
believe that behavioral
health treatment is not avail-able
unless Medicaid clients
are ”clean and sober.”
Finding II
OFFICE OF THE AUDITOR GENERAL
28
n Many respite-like services and residential detoxification
are covered services—In addition to the more general con-fusion
over coverage for substance abuse services, interviews
revealed two other examples of confusion about services
covered. First, confusion exists regarding respite services,
which provide relief to care givers in order to enable clients
to remain in their homes and communities. One advocate for
the disabled contended that Arizona’s Medicaid program
does not cover respite services for Medicaid-enrolled clients.
BHS’ medical director confirmed that misunderstandings
may exist regarding coverage for these services. BHS’ medi-cal
director asserts that Medicaid can be used to cover res-pite-
like services for Medicaid-eligible clients if the service is
billed under the category “behavior management.”
Second, residential detoxification, which is treatment pro-vided
in a 24-hour facility to manage withdrawal from abuse
substances, may not be clearly understood to be a covered
service, according to a BHS Bureau of Substance Abuse
and General Mental Health representative. Although it is a
covered service, it is not listed in some information identify-ing
services that can be billed to Medicaid.
Rachel
Rachel is a Medicaid-eligible, SMI
client on probation with bipolar dis-order
and past polysubstance abuse
issues. She has been receiving metha-done
for approximately ten years.
Rachel still abuses drugs and has
requested additional substance abuse
treatment services while enrolled in a
RBHA-provided methadone pro-gram.
However, the RBHA contends
that substance abuse treatment pro-grams
will not accept clients on
methadone; therefore, she cannot
obtain any additional substance abuse
treatment.
Finding II
OFFICE OF THE AUDITOR GENERAL
29
Literature suggests that
failing to treat substance
abuse problems along with
mental health problems
limits treatment effective-ness.
Enrollment Another
Source of Confusion
In addition to confusion over which services are covered by
Medicaid, confusion also exists on behalf of some agencies refer-ring
clients for services as to whether clients are enrolled in
Medicaid. During this audit, several of the cases provided to
auditors by the Administrative Office of the Courts and Juvenile
Corrections as examples of Medicaid clients who were referred
but unable to receive services were found by auditors to be cli-ents
who were not actually enrolled in Medicaid. Interviews
with the courts and Juvenile Corrections suggest that both agen-cies
are not always aware of whether their probationers or parol-ees
are enrolled in the Medicaid program, and have not always
been screening clients for Medicaid eligibility or systematically
referring them to the Department of Economic Security for en-rollment.
According to representatives from the Administrative
Office of the Courts, lack of access to information pertaining to
who is enrolled in AHCCCS or the RBHAs contributes to the
Office’s inability to identify Medicaid-eligible clients.
Lack of Clarity Has
Several Effects
These system-wide points of confusion have negative effects on
both delivery of services and state funding.
n Limitations on service effectiveness—By inappropriately
requiring clients to be “clean and sober” prior to receiving
treatment, some clients may be shut out of mental health
treatment. This is especially
significant since people with
mental health disorders often
have problems with substance
abuse. In fact, a 1998 study by
the Center for the Study of Is-sues
in Public Mental Health
performed in New York found that 57 percent of individuals
with a diagnosis of severe mental illness also have a diagno-sis
of substance abuse. Clients may also be shut out of serv-ices
if the referring agency fails to ensure that clients are en-rolled
in Medicaid or KidsCare before referring the client to
Finding II
OFFICE OF THE AUDITOR GENERAL
30
the behavioral health system for services. BHS and the
RBHAs receive limited dollars to provide services to people
who do not qualify for these programs. Failure to ensure cli-ents
are enrolled can result in service delays or denials.
n Shift of funding from Medicaid to state-supplied mon-ies—
The current confusion over Medicaid eligibility and
covered services results in the unnecessary expenditure of
state dollars. If a RBHA inappropriately denies a Medicaid-eligible
client services that Medicaid can cover, or when an
agency fails to ensure that a client is enrolled in Medicaid,
state monies may be spent by other agencies for behavioral
health services. By paying for services with state dollars
rather than Medicaid dollars, the State bears the full brunt of
the cost for service, rather than about only one-third of the
cost that it would pay for Medicaid-covered services. Agency
monies expended for behavioral health services come from
funds that the agencies could otherwise use for different
purposes, thereby reducing agencies’ ability to perform other
functions. Furthermore, in instances where the referring
agency is unaware as to whether the client is enrolled in
Medicaid, the potential exists for the referring agency to pay
for services out of state-only dollars even though the client’s
care is already covered through the Medicaid capitated rate.
Indeed, such double payment for services has occurred in
some instances in the past.
Several Changes Should Be Made
to Ensure That Clients
Receive Entitled Services
Several changes should be made to help clarify Medicaid cover-age
for services and individuals. BHS should create a policy that
clearly identifies Medicaid-covered services. BHS and AHCCCS
may also wish to consider changing the current capitation
method to further diminish confusion regarding Medicaid’s
coverage of substance abuse services. Finally, the courts and
Juvenile Corrections should identify screening methods.
Clarify policy—BHS can help dispel uncertainty regarding
Medicaid coverage by clearly describing such services in policy.
Currently, BHS’ policy regarding Medicaid-covered services is
Finding II
OFFICE OF THE AUDITOR GENERAL
31
incomplete and, in some instances, unclear. It states that covered
services are those described on a matrix of different codes used
by the RBHAs for billing services. However, the matrix itself
does not list residential detoxification services as a Medicaid-covered
service. In addition, it is not clear from either the policy
or the matrix that services such as respite or personal care can be
billed under the category “behavior management,” which is
covered by Medicaid. BHS and AHCCCS are currently propos-ing
to clarify the policy.
Consider changing capitation structure—To make it clearer that
substance abuse services are available for all types of Medicaid
clients, AHCCCS and BHS should consider changing the way
that capitation rates are set. As noted above, Arizona currently
sets different capitation rates for children, SMI adults, and adults
with general mental illness/substance abuse problems. This
capitation method does not appear to have been consciously
chosen by the State. Rather, it evolved over time as different
groups of individuals became covered under Medicaid, with the
last group being adults with general mental health disorders
who are not seriously mentally ill. This may lead people to be-lieve
that Medicaid-eligible children or adults with serious men-tal
illnesses cannot receive substance abuse treatment. Arizona
could move toward developing rates along only demographic
lines (for example, children, adults) instead. According to the
Urban Institute, most states’ managed care capitation rates are
simply divided along demographic lines rather than by diagno-sis,
although methods vary.
Develop methods to identify Medicaid and KidsCare eligible and
enrolled clients—In order to ensure that clients referred by the
courts and Juvenile Corrections are enrolled in Medicaid and
KidsCare before being referred to the behavioral health system,
these two agencies should develop additional screening methods
to identify Medicaid- and KidsCare-eligible clients and better
train probation and parole officers on eligibility requirements for
these programs. In addition, both the courts and Juvenile Cor-rections
should investigate ways of determining which of their
clients are enrolled in these two programs, since actual enroll-ment
is performed by the Department of Economic Security.
BHS and AHCCCS should explore the possibility of giving the
courts access to the names of their enrollees to ensure that Medi-caid
is used to pay for services when clients are enrolled in the
BHS’ matrix describing
services does not include
some Medicaid-covered
services.
Finding II
OFFICE OF THE AUDITOR GENERAL
32
program. If BHS and AHCCCS do provide the courts such ac-cess,
efforts should be made to ensure that client confidentiality
is maintained.
Recommendations
1. BHS and AHCCCS should develop a policy for RBHAs that
clearly specifies the types of services that are reimbursable by
Medicaid. As part of this, the AHCCCS/ADHS billing codes
(service matrix) should be updated.
2. AHCCCS and BHS should consider altering capitation rates,
in order to make it clearer that children and adults with seri-ous
mental illnesses are entitled to substance abuse services.
Further, the two agencies should work with RBHAs and
providers to educate them about entitlement to such services.
3. The Administrative Office of the Courts and Juvenile Correc-tions
should develop methods to screen clients for Medicaid
and KidsCare eligibility.
4. The Administrative Office of the Courts and Juvenile Correc-tions
should further train probation and parole officers on
Medicaid and KidsCare eligibility requirements.
5. The Administrative Office of the Courts and Juvenile Correc-tions
should investigate methods of identifying whether their
clients are enrolled in KidsCare or Medicaid.
6. BHS and AHCCCS should explore the possibility of giving
the courts access to the names of their enrollees to ensure that
Medicaid is used to pay for services when clients are enrolled
in the program. If BHS and AHCCCS do provide the courts
such access, efforts should be made to ensure that client con-fidentiality
is maintained.
OFFICE OF THE AUDITOR GENERAL
33
FINDING III CHANGES COULD ENHANCE
ABILITY TO SECURE
SPECIALIZED SERVICES
Even when there is no dispute about whether a client is eligible
or which agency should pay for the service, certain services are
simply unavailable. Clients in rural areas, for example, may not
have appropriate services nearby. While it may not be possible to
address all of these gaps in services, Auditor General staff identi-fied
three options that could enhance the RBHA’s ability to se-cure
specialized provider services:
n Increasing rates for certain services to attract more providers
for services that are not now sufficiently available;
n Ensuring that some or all provider contracts contain provi-sions
requiring them to provide services for more difficult or
disruptive clients; and
n Exploring ways to expand the pool of providers to include
behavioral health therapists, social workers, and others cur-rently
not part of the approved provider group.
Services Not
Always Available to
Entitled Clients
Services required by clients with complex needs may not be
available in some cases. Some clients require very intense, spe-cialized
services that may be difficult to provide, especially in
rural areas. In addition, providers may not always accept clients
who are difficult or disruptive or who have felony convictions.
Specialized services for some clients difficult to meet—Work
done for this audit, as well as studies already conducted of the
behavioral health service delivery system, indicate that provider
services may be lacking in some cases for clients with special
needs. For example, the studies performed by Human Systems
Certain services are simply
unavailable.
Finding III
OFFICE OF THE AUDITOR GENERAL
34
and Outcomes for the JK v. Griffith lawsuit found that provider
services tailored to fit children’s special needs were sometimes
lacking, especially in rural areas. In both northern and southeast-ern
Arizona, the studies noted that services are lacking for the
treatment of sexual abuse, youth sex offenders, and bonding or
attachment disorders. In addition, interviews with DDD staff
suggest that services for developmentally disabled clients may
not always be tailored to their needs.
Two of the cases reviewed by the audit team provide examples
of service availability problems for clients with special needs:
Services are lacking for the
treatment of sexual abuse and
youth sex offenders.
Jake
A RBHA transferred Jake, a 14-year-old
mentally disabled client, to a par-tial-
care facility that did not provide
treatment to clients having an I.Q.
score as low as Jake’s because there
was no other option for placement.
Kristine
Kristine, a 20-year-old developmental dis-abilities
client who is mildly retarded, suffers
from severe depression with psychotic fea-tures,
and cannot find a placement near the
geographic area where she would like to live.
After her discharge from the Arizona State
Hospital, the RBHA placed her in rural-area
group homes that could not handle her
extensive needs. Currently, despite Kristine’s
wishes, the rural RBHA and provider re-sponsible
for her care are attempting to place
her in a residential setting in Maricopa
County because the rural RBHA does not
have a residential placement to accommo-date
Kristine’s intense needs.
Finding III
OFFICE OF THE AUDITOR GENERAL
35
In Kristine’s and Jake’s cases, the lack of appropriate services
appeared to affect the quality of the clients’ treatment. For exam-ple,
the case coordinator at the partial-care setting in which Jake
was placed stated that he was not benefiting from the partial-care
program because he could not keep up with the other chil-dren.
The case coordinator believed that he required one-on-one
attention.
Disruptive and difficult clients not always accepted—Services
may also be limited for some clients because the clients are diffi-cult
to manage. Interviews with foster care and Developmental
Disabilities caseworkers suggest that clients referred for services
are sometimes screened to determine if the client’s behavior is
too difficult to handle, or rejected from facilities if they “act up.”
Joseph is a probationer in need of services who was denied
placement because of his criminal background:
Joseph
Joseph, a seriously mentally ill (SMI),
homeless, 34-year-old suffering from manic
depressive schizophrenia, who had served
time in jail for drunk driving, was approved
by a RBHA for treatment after he was ad-mitted
to an urgent care center. According
to the Probation Officer, the RBHA said that
the providers to whom he was referred
refused to accept him due to his past felony
conviction. As a result, the urgent care cen-ter
prepared to refer him to a homeless
shelter, until his probation officer placed
him in a residential treatment center funded
by adult probation. In this case, the provider
who apparently refused to accept Joseph
was not required by contract with the
RBHA to accept him. However, the RBHA
is under the obligation to ensure that some-one
provides medically necessary services
to entitled clients.
Finding III
OFFICE OF THE AUDITOR GENERAL
36
Changes Could Make
Services for Special-Needs
Clients More Available
Although it probably will not be possible to provide services in
every instance, changes can be made to better ensure that clients
receive the specialized care that they need.
n Changes affecting provider rates could make it easier for
RBHAs to pay some providers more money in order to at-tract
specialized providers.
n In addition, changes in contracting practices could ensure
that some providers are available to care for disruptive or dif-ficult
clients.
n Finally, altering the State’s Medicaid plan could allow
RBHAs to contract with individual certified master’s-level
practitioners, thus allowing RBHAs to fill some service gaps
when provider services are lacking.
Some service availability problems will probably continue—In
some cases, there may be no easy solutions to finding providers
who can meet clients’ specialized needs. In several interviews
with DHS, RBHA, and provider representatives it was noted that
the number of behavioral health providers is declining. Accord-ing
to the Division of Licensure, many providers have been go-ing
out of business in recent years, although the exact number is
unknown. Provider shortages may be especially pronounced
among providers who handle sex offenders. Indeed, Juvenile
Corrections officials noted that they are sending some probation-ers
out of state to receive treatment because of provider short-ages
in Arizona. In addition, limitations in the supply of provid-ers
may be occurring in rural areas. A 1999 study by the National
Rural Health Association found that there is “substantial evi-dence
that the number of mental health providers in rural
America is inadequate.”
RBHAs could increase provider rate flexibility to help attract
some providers—Paying providers higher rates to serve more
difficult clients could have an effect on securing such services.
RBHAs are allowed to pay providers any rate necessary to ob-tain
needed services. Nonetheless, according to a memo from
The number of behavioral
health providers is declining.
Finding III
OFFICE OF THE AUDITOR GENERAL
37
BHS to the RBHAs, some RBHA officials apparently believe that
provider contractor rates can be no higher than rates included on
a list BHS distributes to RBHAs to report services delivered. This
misperception may have affected the ability of RBHAs to con-tract
for a sufficient number of providers since they may not
have believed they were allowed to pay rates higher than those
listed. Currently, BHS is attempting to resolve this misperception
by informing the RBHAs that provider contract rates are flexible.
Ensuring that some providers take difficult clients—BHS could
also help ensure that the clients who are difficult or disruptive
receive specialized care by ensuring that a sufficient number of
the RBHAs’ contracts require providers to accept and serve cli-ents
referred to them. Currently, only one RBHA’s contract con-tains
such a clause. BHS, who oversees RBHA/provider con-tracting,
should ensure that at least a sufficient number of
RBHA/provider contracts contain such provisions, in exchange
for higher provider rates or other incentives.
Allowing RBHAs to contract with individual therapists—
AHCCCS and BHS could also help ensure that services are
available to clients with specialized needs by expanding the pool
of potential service providers. Currently, RBHAs are prohibited
from contracting directly with many non-physician behavioral
health professionals for service delivery. All services provided by
non-physicians must be delivered through licensed provider
facilities, with the exception of individual services performed by
licensed psychologists, physician assistants, and nurse
practitioners. Such a prohibition is included in contracts between
BHS and its RBHAs and in AHCCCS behavioral health rules and
reflects a limitation currently contained in the State’s Medicaid
plan that is submitted to the federal Health Care Financing Ad-ministration.
Although contracts currently do not allow the pool of providers
to be expanded in this way, it is possible to change the current
limitation. According to an AHCCCS official, the current re-quirement
exists because behavioral health therapists in Arizona
are not licensed. However, it is possible for AHCCCS to request
that the Health Care Financing Administration amend its Medi-caid
plan to allow services to be provided by approximately
RBHAs are allowed to pay
providers any rate necessary
to obtain needed services.
Amending the State’s Medi-caid
plan could allow the
RBHAs to directly contract
with individual therapists
certified by the State Board of
Behavioral Health Examiners.
Finding III
OFFICE OF THE AUDITOR GENERAL
38
5,200 substance abuse counselors and master’s-level social work-ers
and therapists, certified through the State’s Board of Behav-ioral
Health Examiners. Such a change could potentially make
professional and outpatient services more readily available. For
example, one official at a rural RBHA noted that the RBHA
wished to contract with a certified practitioner who specialized
in therapy for those who have been sexually abused, but may
have been prohibited from doing so due to this restriction.
Recommendations
1. BHS should re-examine listed provider rates to help ensure
that RBHAs are not artificially constrained in paying provid-ers
higher rates to obtain needed services for clients.
2. BHS should ensure that a sufficient number of
RBHA/provider contracts contain language requiring the
provider to accept and serve clients who are difficult or dis-ruptive,
in exchange for higher provider rates or other incen-tives.
3. AHCCCS should consider requesting a change in the State’s
Medicaid plan, allowing professionals certified by the Board
of Behavioral Health Examiners to also be eligible for pro-viding
services.
OFFICE OF THE AUDITOR GENERAL
39
FINDING IV EXPANDING BHS’ ROLE IN
SERVING JUVENILE OFFENDERS
COULD SAVE THE STATE MONEY
The limited role that BHS plays in providing behavioral health
services to juvenile offenders should be examined. Currently,
juvenile offenders who are taken out of prison for behavioral
health treatment receive services that are paid for with state-appropriated
Juvenile Corrections dollars. In addition, juvenile
sex offenders on probation or parole are not always referred to
the behavioral health system for possible services, even if they
are eligible for Medicaid-provided services. Providing such care
through Medicaid whenever possible could lower the State’s cost
of providing services, because the federal government pays the
majority of the cost under Medicaid. Under the current arrange-ment,
the State may not effectively leverage these federal dollars.
Making such a change would require BHS to take greater re-sponsibility
for providing the behavioral health component of
such care. In order to conserve state dollars and effectively lever-age
federal Medicaid dollars, the Division should ensure that the
RBHAs are made responsible for providing behavioral health
care to juvenile sex offenders and Medicaid-eligible prisoners
removed from prison for treatment. Also, the Division should
work with Juvenile Corrections to ensure that Medicaid is spent
whenever possible for such behavioral health services.
BHS Plays Limited Role in Providing
Services for Juvenile Offenders
Juvenile justice agencies sometimes pay for behavioral health
treatment for juveniles who could receive Medicaid-funded
treatment through the behavioral health system. The courts and
Juvenile Corrections often pay for behavioral health treatment
for sex offenders on probation or parole. Officials noted that
these people are not referred to the behavioral health care system
for services because the RBHAs will not treat these clients. This
situation occurred in one of the cases auditors reviewed (see
Patrick, page 40).
Finding IV
OFFICE OF THE AUDITOR GENERAL
40
It appears that juvenile justice agency officials’ belief that the
behavioral health care system may not accept sex offenders for
treatment may be well-founded. One interview with a RBHA
psychiatrist seemed to corroborate that RBHAs may indeed
reject such clients. This psychiatrist noted that children who are
sex offenders are traditionally shifted to other agencies for treat-ment.
Sex offenders on probation and parole are not the only ones who
receive services through the juvenile justice system when such
services could be provided by BHS. Currently, juvenile offenders
who are removed from prison to receive behavioral health
treatment in secure residential treatment settings receive their
treatment in facilities funded by Juvenile Corrections. According
to Juvenile Corrections officials, they have been told in the past
by the RBHAs that Medicaid will not pay for treatment for pris-oners,
even when they are removed from prison to receive
needed treatment. However, Medicaid will pay for services (ex-cept,
in some cases, room and board) as long as the juvenile is
enrolled, the services are medically necessary, and the juvenile is
not an inmate in a public institution.
Patrick
Patrick, a 16-year-old sex offender on
probation who was eligible for Medi-caid,
was not referred to BHS for
more than two years after his release
from prison. Instead, he was placed in
residential (live-in) treatment centers
funded by the courts, and a juvenile
sex offender program at Adobe
Mountain Correctional Facility.
Finding IV
OFFICE OF THE AUDITOR GENERAL
41
Shifting Medicaid-Eligible Juveniles to
Behavioral Health Services System
Could Help Stretch State Dollars
By not referring Medicaid-eligible juvenile offenders more read-ily
to BHS and its network of RBHAs, the State is losing an op-portunity
to leverage federal Medicaid dollars and stretch its
own appropriations for behavioral health services. If juvenile
offenders who have been released from prison (or removed for
medical care), qualify for Medicaid, their care could potentially
be paid for by Medicaid dollars. Medicaid cannot pay for serv-ices
delivered to inmates of public institutions. However, an
official at the Health Care Financing Administration (the federal
agency that oversees Medicaid) stated that although the admini-stration
has no written policy on the subject, it will allow Medi-caid
to pay for some or all medically necessary services for pa-tients
who are removed from prison for medical care. Any limi-tations
on the use of Medicaid dollars in such instances (such as
Medicaid not being available to pay for room and board in many
residential settings) are the same limitations that apply to the
delivery of any Medicaid service.
State dollars could be saved if services for unincarcerated Medi-caid-
eligible juveniles were provided through BHS and the
RBHAs instead of being paid for by Juvenile Corrections. In this
part of the system, the State pays approximately one-third of
Medicaid-provided services and the federal government pays
the remaining two-thirds. By ensuring that Medicaid paid for the
services provided to juveniles who were eligible for such sup-port,
the State could stretch those dollars that are appropriated to
provide care for people who must be supported solely by state
dollars.
Making Such a Change Would
Require a Shift in Responsibility
While Medicaid dollars could be used to deliver behavioral
health services to incarcerated persons removed from prison for
medical care, BHS staff have not believed Medicaid will pay for
such care. According to the Department’s Assistant Director for
Behavioral Health Services, the Division has understood that
such services are not reimbursable under Medicaid. Nonetheless,
Finding IV
OFFICE OF THE AUDITOR GENERAL
42
according to a HCFA official, the State does have the ability to
use Medicaid dollars to provide such services, although it is
under no obligation to do so. The HCFA official also noted, how-ever,
that a finalized policy statement in this area had not yet
been developed. An AHCCCS official confirmed that Medicaid
could potentially pay for medically necessary services for Medi-caid-
eligible prisoners who were removed from prison for treat-ment.
This official stated that AHCCCS had recently received a
memo from HCFA on the subject.
In order to conserve state dollars and effectively leverage federal
Medicaid dollars, the Division should ensure that the RBHAs are
made responsible for providing medically necessary behavioral
health care to juvenile sex offenders and Medicaid-eligible
prisoners removed from prison for treatment. Also, the Division
should work with Juvenile Corrections to ensure that Medicaid
is utilized whenever possible for such medically necessary
behavioral health services.
Recommendations
1. In order to conserve state dollars and effectively leverage
federal Medicaid dollars, the Division should ensure that the
RBHAs are made responsible for providing medically neces-sary
behavioral health care to juvenile sex offenders and
Medicaid-eligible prisoners removed from prison for treat-ment.
2. The Division should work with Juvenile Corrections to en-sure
that Medicaid is utilized whenever possible for juvenile
sex offenders and for persons removed from prison for medi-cally
necessary behavioral health treatment.
OFFICE OF THE AUDITOR GENERAL
43
OTHER PERTINENT INFORMATION
During this audit, other pertinent information was obtained
regarding numerous efforts undertaken to improve service
provision for people involved with the behavioral health sys-tem
and other state agencies, such as the Department of Eco-nomic
Security, the Arizona Department of Juvenile Correc-tions,
and the Administrative Office of the Courts. Table 1 on
pages 52 through 54 summarizes the groups and projects
auditors reviewed.
Coordination Problems Among
Agencies Identified
Since 1986, numerous efforts have been initiated to improve
coordination of behavioral health services between state agen-cies.
Multi-agency projects and legislative committees have
published studies on how to improve services for people (pri-marily
children) who are involved with more than one agency.
In addition, numerous efforts have ensued to improve inter-agency
coordination. While some efforts are initiatives stem-ming
from the federal government and the Governor, others
have actually evolved out of the recommendations made by
other groups trying to improve coordination. Furthermore,
recent efforts have been initiated as a result of litigation (JK v.
Griffith) contending that Medicaid-enrolled children receive
inadequate mental health services in Arizona.
These studies and efforts identify and attempt to solve a num-ber
of problems that confront clients involved with multiple
agencies. Such problems are more broad in scope than the one
identified in this report: namely, the ability of clients referred to
the behavioral health system to receive services (which this
report attempts to delve into more deeply). Instead, these stud-ies
and efforts identify and attempt to provide solutions to three
central problems:
4 Fragmentation in service delivery—Numerous studies
identify Arizona’s fragmented service delivery as a barrier
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
44
to people receiving appropriate services. For example, the
nonprofit group Partnership for Children wrote in a 1991
project report that “Children and families [in Arizona] re-ceive
services from multiple agencies with limited institu-tional
willingness to cooperate or communicate.“ It further
stated that “current services target specific problems with
fragmented services driven by funding sources rather than
meeting the needs of the whole family.” The same report
adds that different agencies each treat a small part of the
problem, often in different buildings and using their own
eligibility standards. Efforts such as Governor Hull’s No
Wrong Door Initiative, which is striving to ensure that peo-ple
needing services can go to any agency to begin the proc-ess
of receiving treatment, is aimed at resolving fragmenta-tion
problems.
4 Inappropriate service delivery—A number of studies have
noted that children involved with multiple state agencies
often receive services that are inappropriate or too limited to
fit their needs. For example, studies by the Partnership for
Children and the Joint Legislative Children and Families
Reorganization Study Committee both note that service de-livery
to children in this State is crisis-oriented, thus result-ing
in more costly and less effective services. The 1998
studies performed as a result of the JK v. Griffith lawsuit
noted that Medicaid-eligible children with multiple agency
involvement receive treatment that may be too brief and
limited to meet their needs.
4 Redundancy in service delivery—Many studies and ef-forts
focus on redundancies that exist in the current service
delivery system. For example, the Joint Legislative Children
and Families Reorganization Study Committee notes re-dundancy
in data gathering between agencies. Efforts such
as the Interagency Case Management Project, a joint part-nership
between state agencies that serve children, such as
DHS and the Department of Economic Security, are at-tempting
to address redundancy problems.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
45
Similar Recommendations Made
to Improve Service Coordination
The recommendations proposed and/or implemented by the
committees, task forces, and others cover a broad spectrum.
Suggested solutions for resolving the problems described above
range from redesigning the way services are delivered to pro-cedural
improvements, such as changing the amount and type
of information collected from shared clients.
Streamline the service delivery system—In order to address
the problem of a fragmented service delivery system, some
groups advocate a change to one streamlined process for
clients receiving services from multiple agencies. Groups
propose having one centralized location or case manager
capable of seeking services from more than one agency, to
minimize the number of agencies the client interacted with.
4 Centralized screening process—The Partnership for
Children recommended a system involving a uniform path
by which children and families receive services from multi-ple
agencies. It proposed a centralized screening process so
clients could be made aware of all services available to
them. Services would then be coordinated through a service
plan developed to address all of the client’s needs.
4 Local service centers—The Joint Legislative Children and
Families Reorganization Study Committee reported that
current services require families with multiple problems to
exit and re-enter multiple systems at multiple locations. This
committee advocated an integrated process for service de-livery,
as did the Partnership for Children. To do so, it pro-posed
the creation of family assistance centers. Case manag-ers
located at these centers would be trained to access serv-ices
from multiple agencies.
4 Integrated case management—Similarly, the Interagency
Case Management Project (ICMP), currently implemented
as a pilot project in limited areas, assigns a single case man-ager
to serve its clients. The project involves children and
their families who have multiple problems and are involved
with multiple agencies. Rather than have multiple case
managers from each agency, the family interacts with one
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
46
ICMP case manager who is cross-trained to provide services
through multiple state agencies.
Provide full continuum for specialized services—Addressing
the concern that services are too limited or inappropriate,
various efforts have recommended that a full range of serv-ices
be available to specific populations. The types of serv-ices
addressed include treatment for juvenile sex offenders
and substance abusers, as well as transitional services be-tween
agencies.
4 Specialty services for children and adolescents—In its
1997 Annual Report, the Children’s Behavioral Health
Council stated that a continuum is lacking in specialty
services, such as treatment for juvenile sex offenders and
substance abuse services for children and adolescents. Their
recommendation was to “develop easier access to services.”
In its 1998 Annual Report, the Council states that it will
continue to advocate for expanded substance abuse services
specific to children and for a more comprehensive service
system.
4 Services for released mentally impaired offenders—
According to the Council on Offenders with Mental Impair-ments,
it is important to establish services that incarcerated
juveniles need and programs that offer a continuum of care
after juveniles leave incarceration. In its 1998 Annual Re-port,
the Council recommends that a continuum of services
be available for released mentally impaired offenders. Of-ten,
developmentally disabled adults and juveniles are ex-cluded
from a range of transitional services because of their
illness and/or offenses. The Council recommends that in-teragency
cooperation be sought for providing a continuum
of housing and other transitional services for mentally im-paired
offenders released from custody.
Improve communication among agencies—To diminish frag-mentation
and facilitate common strategies to care for mu-tual
clients, groups have proposed and implemented ways
to solve communication problems among the agencies and
better serve the clients’ needs.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
47
4 Local councils—In its 1998 Annual Report, the Council on
Offenders with Mental Impairments calls for an increased
flow of communication between correctional facilities and
community mental health providers. The council also rec-ommends
establishment of local councils to increase the
networking between correctional facilities, criminal justice
agencies, and behavioral health agencies.
4 Interagency cabinet—The Joint Legislative Children and
Families Reorganization Study Committee recommends
establishing an Interagency Coordination Cabinet com-prised
of agency directors, local advisory boards, and local
assistance centers. Through its membership, the cabinet
would facilitate communication regarding the coordination
of agency procedures and the fostering of integrated service
delivery.
4 Multi-agency teams and coordinating councils—Im-proved
communication has taken place in Arizona, accord-ing
to the Independent Reviews being conducted as part of
the JK v. Griffith lawsuit. The reports cite examples of Multi-
Agency Teams and Care Coordinating Councils that have
been developed to resolve problems experienced by clients
involved with multiple agencies.
Improve information-sharing among agencies—In order to
address the problem of collecting redundant client informa-tion,
many groups recommend the creation of centralized
data systems. Agencies collect similar client information,
and oftentimes agencies are unaware of the services a client
may be receiving through another agency. A central system
used to store information would alleviate the problem of
collecting redundant information, as well as providing use-ful
information to agencies for treatment-planning purposes.
4 Create central information system—The Joint Legislative
Children and Families Reorganization Committee Study ex-amined
changing the information management architecture,
noting that 20 different informational systems are used to
support children and family services. The recommendations
involve creating a central, multi-agency information system
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
48
to collect client information from one location that would
allow a case manager to access the information from multi-ple
locations and/or agencies.
4 Create common database, allow interfaces between
agency computer systems—The Partnership for Children
effort recommends the creation of a database to gather
common data needed to support the necessary service de-livery
functions. It also advocates allowing the agencies’
systems to interface with each other.
4 Exchange assessment and case-planning data through
a data warehouse—The Assessment and Evaluation Work
Group sees a need to expand informational linkages beyond
demographic data to allow the exchange of assessment and
case-planning data. The group advocates developing a
common data warehouse.
4 Develop information-sharing links between criminal
justice and behavioral health system—As part of the
goals developed for its 1997 Annual Report, the Council
on Offenders with Mental Impairments sought to de-velop
information-sharing links among the stakeholders
for mentally impaired offenders. In its 1998 Annual Re-port,
the Council notes progress in improving data shar-ing
between the criminal justice and behavioral health
system. Various counties have established methods in
order to increase identification of RBHA-enrolled seri-ously
mentally ill clients who are incarcerated. One ex-ample
is the development of computer linkages between
the RBHA and Maricopa County Sheriff’s Office. Pima
County has also agreed to share information on the
booking and release of mentally impaired offenders with
the RBHA in Pima County.
4 Avoid collecting redundant information—Governor
Hull’s No Wrong Door Initiative, after assessing the existing
services provided by the state agencies and the service de-livery
processes used across multiple agencies, found that
common information should not be collected from the client
redundantly. The effort notes that agencies should have ac-cess
to commonly needed information once it is collected,
regardless of the source. The effort also advocates the crea-
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
49
tion of service lists to identify all family and child resources
available for successful referral to a service provider.
Provide more timely, complete, and accurate assessments—
Problems with inadequate service delivery have been noted
to stem from incomplete and inaccurate assessments. An
adequate assessment is essential to understanding the cli-ent’s
needs and planning for appropriate services. Groups
have focused on this important aspect and have suggested
similar recommendations in that common information
should be shared across agencies.
4 Incorporate developmental and long-term view—The
agencies involved with the JK v. Griffith lawsuit developed a
document called “JK Practices to Achieve Success for Chil-dren.”
The Practices call for assessments that are sufficient
and incorporate a developmental and long-term view.
There must also be a shared understanding of the child and
family as a result of the assessment process so that an ap-propriate
intervention plan can be developed.
4 Adopt similar guidelines—The Assessment and Evalua-tion
Work Group recommends that all agencies need to
adopt similar guidelines for assessments. Further, it advo-cates
the formation of collaborative special teams for those
served by multiple agencies to help identify the most effec-tive
service plan.
4 Common screening process—Governor Hull’s No
Wrong Door Initiative also recognizes that the focus should
be on integrating the processes for accessing services, such
as screening and referrals. The strategic plan for this project
recommends developing a common screening process that
could be performed at any point of the client’s entry into the
service system. Again, it advocates having common data
elements to better coordinate and share information for de-termining
the best way to meet the client’s needs.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
50
Use funding more efficiently—It has been noted that agencies
sometimes provide limited services because of constraints on
their resources. Many groups recommend identifying fund-ing
barriers to enable efficient and effective use of resources
so that services can be provided to those in need.
4 Explore ways to make funding more flexible—In its re-view
of funding issues, the Partnership for Children identi-fies
current funding streams, which support services to
children and families. Often, the review discovers, funding
could be more effectively and efficiently spent if the State
has more flexibility in its use. The Partnership makes a few
recommendations for exploring funding options. One rec-ommendation
calls for designating a state-level entity
charged with developing a plan to maximize flexible fund-ing.
They call for the lead responsibility to be established
within the Governor’s Office, not within an existing agency.
4 Expand joint purchase agreement—In its 1997 Annual
Report, the Children’s Behavioral Health Council advo-cates
expanding the existing Single Purchase of Care
contract (a contract between state agencies and DHS,
DES, and other agencies aimed at simplifying provider
contracting) to obtain more services for children and
families. The Council also recommends that government
agencies become more involved in sharing the responsi-bility
for children. According to the Council, this would
involve cost-sharing agreements among the agencies. In
its 1998 annual report, the Council says it supports DHS
in obtaining grants to fund innovative children’s behav-ioral
health programs. The Council also advocates find-ing
additional non-Medicaid revenue (i.e., state appro-priations
and federal block grants).
4 Establish mechanism to ensure sufficient funding—
The Council on Offenders with Mental Impairments advo-cates
establishing a funding mechanism to ensure that
services are supported for non-incarcerated mentally
disturbed youth. They call for reviewing innovative pro-grams
to fund services for mentally ill juveniles. This in-cludes
programs that are funded by grants for additional
services.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
51
4 Maximize use of federal funds—In its 1999 Progress Re-port,
the Behavioral Health Subcommittee also recommends
that funding support the needs of children in the State’s
care. The Subcommittee emphasizes that special attention
be taken to ensure providers/placements are not changed
based on how a service is funded. They also advocate the
use of Medicaid and KidsCare funding to its fullest extent to
conserve state monies.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
Table 1
Behavioral Health Services Coordination Audit
Efforts to Improve Coordination of Behavioral Health Services
Group/Project Authorization Participants Responsibility Status
Behavioral Health
Planning Council
Laws 99-660 (U.S.
Congress 1986)
ADHS, AHCCCS, DES,
criminal justice representa-tives,
providers, consumers,
and families
Determines whether behavioral health
services are sufficiently provided
across the State
Meets quarterly
Children’s Behav-ioral
Health
Council
A.R.S §§36-3421 and
3422 (1988)
ADE, ADHS, ADJC,
AHCCCS, AOC, DES, Gov-ernor’s
Office, legislators,
and community representa-tives
Provides recommendations on im-proving
behavioral health issues facing
Arizona’s children. Oversees devel-opment
of a single, coordinated con-tinuum
of services for children. Re-views
intergovernmental agreements
entered into by agencies serving chil-dren.
Meets monthly and issues an
annual report to the Governor
and Legislature. Council to be
sunset December 1999.
Partnership for
Children
Arizona Community
Foundation and
Tucson Community
Foundation (1991)
ADE, ADHS, ADJC,
AHCCCS, AOC, DES, Gov-ernor’s
Office, legislators,
providers, and community
representatives
Created a comprehensive, integrated,
and responsive service delivery model.
Developed model for a coor-dinated
system of care. Pro-posals
made to Legislature for
funding pilot programs, but
model has never been imple-mented.
Council on Of-fenders
with
Mental Impair-ments
Laws 1992, Chapter
234
ADHS, ADJC, AOC, DES,
DOC, RBHAs, a representa-tive
from the Behavioral
Health Planning Council,
and law enforcement and
community representatives
Addresses issues concerning the wel-fare
of offenders with mental impair-ments.
Identifies needed services for
offenders, develops plan to meet their
treatment needs, and makes recom-mendations
to improve service coordi-nation.
Meets monthly and issues an
annual report to the Governor
and Legislature.
52
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
Table 1 (Cont’d)
Behavioral Health Services Coordination Audit
Efforts to Improve Coordination of Behavioral Health Services
Group/Project Authorization Participants Purpose Status
Governor’s Ac-tion
Committee
Governor (1993) ADE, ADHS, ADJC, AOC,
DES, service providers,
consumers, and advocates
Developed an intergovernmental
agreement (known as the Children’s
IGA) between state agencies that serve
children.
Recommendations provided
to Governor in 1993.
Children’s IGA
Executive Com-mittee

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State of Arizona
Office
of the
Auditor General
PERFORMANCE AUDIT
Report to the Arizona Legislature
By Debra K. Davenport
Auditor General
February 2000
Report No. 00-2
BEHAVIORAL
HEALTH
SERVICES
INTERAGENCY
COORDINATION
OF SERVICES
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee
composed of five senators and five representatives. His mission is to provide independent and impar-tial
information and specific recommendations to improve the operations of state and local government
entities. To this end, he provides financial audits and accounting services to the state and political
subdivisions and performance audits of state agencies and the programs they administer.
The Joint Legislative Audit Committee
Representative Roberta L. Voss, Chairman
Senator Tom Smith, Vice-Chairman
Representative Robert Burns Senator Keith Bee
Representative Ken Cheuvront Senator Herb Guenther
Representative Andy Nichols Senator Darden Hamilton
Representative Barry Wong Senator Pete Rios
Representative Jeff Groscost Senator Brenda Burns
(ex-officio) (ex-officio)
Audit Staff
Shan Hays—Manager
and Contact Person (602) 553-0333
Lois Sayrs—Methodologist
Kim Van Pelt—Audit Senior
Kip Memmott—Audit Senior
Monique Cordova—Staff
Teresa Bennett—Staff
Julie Maurer—Staff
Angelica Gonzalez—Staff
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410
Phoenix, AZ 85018
(602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
2910 NORTH 44th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553-0333 • FAX (602) 553-0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL
February 15, 2000
Members of the Legislature
The Honorable Jane Dee Hull, Governor
Dr. James L. Schamadan, Acting Director
Department of Health Services
Transmitted herewith is a report of the Auditor General, a performance audit of the
coordination and provision of behavioral health services among selected state agencies, in
response to an October 6, 1998, resolution of the Joint Legislative Audit Committee. The audit
was conducted under the authority vested in the Auditor General by A.R.S. §41-1279.
This report addresses why people referred from other state agencies to the state behavioral
health system do not always receive services. Several factors appear to contribute to such
service denials. First, we found that disputes over the medical necessity of services and
agency roles in serving clients with special needs often contribute to disagreements over
needed services. Second, there is some confusion over whether some services, particularly
substance abuse services, are available to Medicaid clients. Confusion also exists over whether
clients referred by other state agencies are actually enrolled in the Medicaid program. Finally,
some services are simply unavailable, especially for disruptive clients or for clients living in
rural areas. Several recommendations, ranging from clarifying existing policies to transferring
the administration of behavioral health services for developmentally disabled ALTCS clients,
are offered to help diminish interagency disagreements and improve access to needed
services.
This report also recommends that the Division of Behavioral Health Services play a greater
role in providing treatment for Medicaid-eligible juvenile sex offenders on parole or
probation, and Medicaid-eligible juveniles who are removed from prison for behavioral
February 15, 2000
Page -2-
health treatment. Such a shift in service provision could help the State save money. If BHS
provides such services when medically necessary with Medicaid dollars, the State may be able
to conserve money since Medicaid dollars are largely financed by the federal government.
Currently, such services are paid for by the courts and Juvenile Corrections using state-only
dollars.
As outlined in its response, the Department of Health Services agrees with all of the findings
and recommendations. In addition, although they were not asked to provide written re-sponses
to the report, the Arizona Health Care Cost Containment System (AHCCCS), the
Arizona Office of the Courts, the Department of Juvenile Corrections, and the Department of
Economic Security reviewed the report. All four agencies also agreed with the recommenda-tions
that pertained to them.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on February 16, 2000.
Sincerely,
Debbie Davenport
Auditor General
Enclosure
OFFICE OF THE AUDITOR GENERAL
i
SUMMARY
The Office of the Auditor General has conducted a performance
audit of the coordination and provision of behavioral health
services among selected state agencies, in response to an October
6, 1998, resolution of the Joint Legislative Audit Committee. The
audit was conducted under the authority vested in the Auditor
General by A.R.S. §41-1279. A separate review of the Department
of Health Services—Division of Behavioral Health Services
(BHS) was issued in July 1999 (Report No. 99-12).
Although BHS is responsible for providing publicly funded be-havioral
health services in Arizona, many individuals with be-havioral
health needs first encounter another public agency, such
as a court or the Department of Economic Security. The agencies
often refer these individuals to BHS for services, but are not al-ways
able to access all of the care agency officials believe is
needed for their clients. Previous studies by legislative commit-tees
and private organizations have recommended ways to im-prove
interagency communication and reduce duplicated efforts.
In this audit, in-depth case studies were conducted to explore the
reasons some individuals do not receive the services requested
by the referring agencies. These case studies, along with other
audit methods such as interviews and reviews of documenta-tion,
uncovered common themes that help to explain interagency
disagreements and suggest additional recommendations for
ensuring that other agencies’ referred clients receive appropriate
services.
Managed Care Focus, and Structure
That Divides Responsibility, Leads
to Interagency Disagreements
(See pages 11 through 21)
Arizona’s behavioral health system has three characteristics that
contribute to interagency disagreements.
n First, its managed care focus provides some incentive for
limiting services in order to minimize costs. The Regional
Individuals with behavioral
health needs often encounter
other agencies first.
Summary
OFFICE OF THE AUDITOR GENERAL
ii
Behavioral Health Authorities (RBHAs) that contract with
BHS to administer the delivery of behavioral health services
may incur financial losses if they spend more than the fixed
sum they receive in advance.1 As a result, RBHAs monitor
service utilization, require authorization for service beyond
predetermined limits, and deny services when they are not
medically necessary.
n Second, Medicaid rules require RBHAs to provide only
services that are “medically necessary,” a standard with an
appropriately broad definition that provides ample discre-tion
for allowing or denying services. According to Arizona’s
definition of medical necessity, services must be expected to
benefit the client’s mental or physical health, and should be
delivered in the least restrictive setting proven or predicted to
be effective in meeting the client’s behavioral health needs in
order to conserve costs.
n Third, the fragmented structure of service provision between
agencies allows cost-shifting between agencies. Other agen-cies
can sometimes purchase behavioral health services for
their clients, making it difficult to determine which agency
should pay for such services for a shared client. Distinctions
between agency roles are unclear in some cases.
These system characteristics contributed to interagency dis-agreements
regarding two cases auditors examined, Todd and
Irene.2 Todd, a 15-year-old boy referred to BHS by Child Protec-tive
Services (CPS), was receiving services in a residential treat-ment
center where staff supervised him 24 hours a day, but these
services were terminated by a RBHA psychiatrist who said they
were not medically necessary. Although Todd’s court-appointed
psychiatrist and CPS caseworker believed he needed to stay in
the supervised setting, where he did well, the RBHA psychiatrist
thought his good progress in the supervised setting indicated his
behavioral problems might be caused by family problems at
1 The Division may adjust capitation rates or payments to RBHAs if
losses are too great. Further, contractual limits on the amount of
profit that can be realized by the RBHAs further guard against un-derservice.
2 All names cited in the report have been changed to protect privacy.
Summary
OFFICE OF THE AUDITOR GENERAL
iii
home. In Todd’s case, professionals disagreed about the neces-sity
for providing services in a restrictive live-in setting.
Cost-shifting appeared to be a factor in Irene’s situation. Irene, a
client of DES’ Division of Developmental Disabilities (DDD), has
cerebral palsy, which does not create behavioral health prob-lems.
However, RBHA staff attempted to shift responsibility for
Irene’s services to DDD, first by alleging that her behavioral
health problems were caused by mental retardation, and later,
when they learned she did not have mental retardation, by
claiming that her cerebral palsy explained her behavior.
To alleviate these types of disputes, responsibility for some cli-ents
such as some DDD clients could be transferred away from
the RBHAs. In addition, agencies could make some procedural
changes and BHS could improve its oversight of the RBHAs.
Specifically:
n DDD could assume responsibility for some of its own clients’
behavioral health services. This would be comparatively easy
because DDD already has the needed financial and informa-tion
systems in place for clients enrolled in the Arizona Long
Term Care System (ALTCS).
n BHS and other agencies could reduce medical necessity dis-putes
by working with other agencies to develop methods
for routinely reviewing and synthesizing all agencies’ as-sessment
information, and ensuring that RBHA staff respon-sible
for performing assessments are adequately qualified.
n Finally, to ensure that clients receive adequate and appropri-ate
care, BHS should continue to improve its oversight of
RBHAs to help ensure they do not inappropriately limit or
deny services.
Confusion Exists
Regarding Medicaid Coverage
(See pages 23 through 32 )
Confusion over which services Medicaid will cover explains why
some clients may be denied services. Substance abuse coverage,
in particular, sometimes may be misunderstood by RBHA offi-
Cost-shifting appeared to be
a factor in the case of Irene,
a DDD client.
Summary
OFFICE OF THE AUDITOR GENERAL
iv
cials, leading to inappropriate service denial. Medicaid does pay
for medically necessary substance abuse services, regardless of
whether the client has another behavioral health problem in
addition to the substance abuse problem. In addition, Medicaid-eligible
clients who have other behavioral health problems do not
need to be free of substance abuse problems before they can receive
medically necessary treatment. Finally, the full array of behav-ioral
health services, including respite-like care and residential
detoxification (not including room and board), can be paid for by
Medicaid, as long as the services are medically necessary and
provided in a Medicaid-compatible setting. In spite of this, a
RBHA denied services to Maria, a pregnant teenager currently in
the Child Protective Services (CPS) system. She was seeking
residential drug treatment, but was denied because she did not
have another behavioral health diagnosis. Similarly, Rachel is a
seriously mentally ill woman currently on probation. She is re-ceiving
methadone for her heroin addiction, but has been told
she must get off methadone before she can receive any other
substance abuse services to address her problems with alcohol
and other substances.
In addition to RBHA officials and providers being confused
about Medicaid coverage for services, the courts and Juvenile
Corrections may not always know whether the person they are
referring for services is enrolled in Medicaid. This can result in
treatment delays or denials, since the behavioral health care sys-tem
has limited monies to treat people who are not entitled to
Medicaid services.
BHS has initiated efforts to ensure that clients with substance
abuse as well as other mental health problems receive treatment.
Nonetheless, the Division should take further actions to diminish
confusion and ensure that clients receive Medicaid-covered
services. Specifically, BHS policies governing the services pro-vided
by RBHAs should be revised to clearly specify all the
services that are covered by Medicaid. In addition, BHS should
approach the Arizona Health Care Cost Containment System
(AHCCCS) about changing the capitation structure because it
appears to contribute to some confusion over whether Medicaid
clients can receive substance abuse treatment. Currently, a differ-ent
capitation rate category exists for “general mental health and
substance abuse,” which may inappropriately imply that chil-
Maria, a pregnant teenager
currently in the CPS system,
was denied residential drug
treatment.
Summary
OFFICE OF THE AUDITOR GENERAL
v
dren and adults with serious mental illness are not eligible to
receive substance abuse services.
To address confusion over enrollment, the courts and the De-partment
of Juvenile Corrections should adopt methods of de-termining
whether probationers or parolees are eligible for and
enrolled in Medicaid and KidsCare. These determinations
should be made before making referrals to the RBHAs.
Changes Could Enhance
Ability to Secure
Specialized Services
(See pages 33 through 38)
Even when there are no disagreements between agencies, audi-tors’
case studies showed that some referred clients may be un-able
to access needed services because the services are simply
unavailable. For example, Kristine, a young woman from a rural
area who has a developmental disability, needed a residential
placement upon her discharge from the Arizona State Hospital,
but the placements available near her home could not handle her
extensive needs. Although such problems appear most prevalent
in rural areas, some clients’ needs are difficult to meet even in
urban areas. For instance, Jake, another DDD client, was placed
in a partial care facility but his I.Q. score was too low for him to
benefit from that facility’s services. Other clients may be rejected
by providers due to disruptive behaviors or other issues. For
example, Joseph is a homeless man who is currently on proba-tion
and who has a serious mental illness. He apparently was
rejected by a provider for treatment because of his past felony
drunk-driving conviction.
While gaps in service availability will likely continue, particu-larly
for sex offenders, AHCCCS and BHS could make some
changes that would help to increase service availability.
n First, BHS can continue its efforts to encourage RBHAs to
contract with providers for difficult-to-find services by in-forming
them that provider contract rates are flexible, al-lowing
the RBHAs to pay higher rates when necessary.
Joseph, a homeless man with
a serious mental illness, was
rejected by a residential
treatment center because of a
felony drunk-driving condi-tion.
Summary
OFFICE OF THE AUDITOR GENERAL
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n Second, BHS could ensure that at least some of the RBHAs’
providers accept difficult or disruptive clients as a condition
of their contracts, in exchange for higher provider fees or
other incentives.
n Finally, AHCCCS could request approval from the Health
Care Financing Administration to let RBHAs contract with
certified substance abuse counselors and master’s-level indi-vidual
providers, such as social workers and therapists, certi-fied
through the State’s Board of Behavioral Health Examin-ers.
Currently, RBHAs can contract only with physicians,
nurse practitioners, physician assistants, psychologists, and
licensed provider facilities.
Expanding BHS’ Role in
Serving Juvenile Offenders
Could Save the State Money
(See pages 39 through 42 )
State dollars could be saved if services for Medicaid-eligible ju-veniles
were provided through BHS and the RBHAs, instead of
being provided by the juvenile justice system. Currently, the
Department of Juvenile Corrections and the juvenile and adult
probation systems pay out of their own state-funded dollars to
treat juvenile sex offenders who are on parole or probation. Ac-cording
to Juvenile Corrections and the courts, these agencies use
their own funding rather than referring these clients to the be-havioral
health system, since the RBHAs have refused to provide
such services in the past. In addition, Juvenile Corrections cur-rently
pays for residential treatment for juveniles who are re-moved
from correctional facilities to receive behavioral health
treatment. In both cases, such services for Medicaid-enrolled
individuals could be paid for by the behavioral health system
with Medicaid dollars, which are provided largely by the federal
government. In order to conserve state dollars and effectively
leverage federal Medicaid dollars, the Division should ensure
that the RBHAs are made responsible for providing medically
necessary behavioral health care to juvenile sex offenders and
Medicaid-eligible prisoners removed from prison for treatment.
Summary
OFFICE OF THE AUDITOR GENERAL
vii
Other Pertinent Information
(See pages 43 through 54)
During the audit, other pertinent information was collected re-garding
previous efforts undertaken to improve service provision
for people involved with the behavioral health system and other
state agencies. Since 1986, numerous studies and other efforts
have been initiated to improve coordination of these services.
Studies by legislative committees and private foundations have
identified problems with fragmentation, redundancy, and inap-propriate
service delivery. To resolve these problems, suggested
solutions have ranged from an overall redesign of the way serv-ices
are delivered to more specific procedural improvements, such
as changing the amount and type of information collected from
shared clients. Specifically, the groups have recommended:
n Streamlining the service delivery system by using a central-ized
screening process, creating local family assistance service
centers, and integrating case management by assigning a sin-gle
case manager to serve interagency clients;
n Providing a full continuum of specialized services for specific
populations;
n Improving communication among agencies by establishing
local councils, an interagency cabinet, and multi-agency teams;
n Improving information sharing among agencies by creating a
central information system, a common database or data ware-house,
developing data-sharing links, and avoiding collecting
redundant information;
n Providing more timely, complete, and accurate assessments by
incorporating a developmental and long-term view, adopting
similar guidelines, and using a common screening process;
and
n Using funding more efficiently, by exploring ways to make
funding more flexible, expanding an existing joint agreement
for the purchase of provider services, establishing a mecha-nism
to ensure sufficient funding, and maximizing the use of
federal funds.
OFFICE OF THE AUDITOR GENERAL
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OFFICE OF THE AUDITOR GENERAL
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TABLE OF CONTENTS
Page
Introduction....................................................... 1
Finding I: Managed Care Focus, and
Structure That Divides Responsibility,
Leads to Interagency Disagreements......... 11
System’s Inherent Vagueness
Leads to Disagreements ................................................. 11
Changes Could
Diminish Some Disagreement ....................................... 16
Recommendations .......................................................... 21
Finding II: Confusion Exists
Regarding Medicaid Coverage ......................... 23
Medicaid Covers a Wide
Range of Services ............................................................ 23
Coverage for Substance Abuse,
Other Services Misunderstood....................................... 25
Enrollment Another
Source of Confusion....................................................... 29
Lack of Clarity Has
Several Effects ................................................................. 29
Several Changes Should Be Made
to Ensure That Clients
Receive Entitled Services................................................ 30
Recommendations .......................................................... 32
Table of Contents
OFFICE OF THE AUDITOR GENERAL
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TABLE OF CONTENTS (cont’d)
Page
Finding III: Changes Could
Enhance Ability to Secure
Specialized Services.................................... 33
Services Not
Always Available to
Entitled Clients................................................................ 33
Changes Could Make
Services for Special-Needs
Clients More Available................................................... 36
Recommendations .......................................................... 38
Finding IV: Expanding BHS’ Role in
Serving Juvenile Offenders
Could Save the State Money....................... 39
BHS Plays Limited Role in Providing
Services for Juvenile Offenders ...................................... 39
Shifting Medicaid-Eligible Juveniles to
Behavioral Health Services System
Could Help Stretch State Dollars ................................... 41
Making Such a Change Would
Require a Shift in Responsibility .................................... 41
Recommendations .......................................................... 42
Table of Contents
OFFICE OF THE AUDITOR GENERAL
xi
TABLE OF CONTENTS (concl’d)
Page
Other Pertinent Information ............................. 43
Coordination Problems
Among Agencies Identified ........................................... 43
Similar Recommendations Made
to Improve Service Coordination................................... 45
Agency Response
Exhibit and Table
Exhibit 1 AHCCCS and ADHS
Division of Behavioral Health Services
Behavioral Health Services
Covered by Medicaid ................................... 24
Table 1 Behavioral Health Services
Efforts to Improve Coordination
of Behavioral Health Services ...................... 52
OFFICE OF THE AUDITOR GENERAL
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OFFICE OF THE AUDITOR GENERAL
1
INTRODUCTION AND BACKGROUND
The Office of the Auditor General has conducted a performance
audit of the coordination and provision of behavioral health
services among selected state agencies, in response to an October
6, 1998, resolution of the Joint Legislative Audit Committee. The
audit was conducted under the authority vested in the Auditor
General by Arizona Revised Statutes (A.R.S) §41-1279. A sepa-rate
review of the Division of Behavioral Health Services was
issued in July 1999 (Report No. 99-12).
The Division of Behavioral Health Services (BHS) within the
Department of Health Services is responsible for providing pub-licly
funded behavioral health services in Arizona. BHS provides
services to persons with a wide variety of behavioral health
problems, ranging from adults with depression, schizophrenia,
or substance abuse problems to children with attention-deficit
hyperactivity disorder and post-traumatic stress disorder.
History and Evolution of the Audit
Although BHS is responsible for providing publicly funded be-havioral
health services in Arizona, long-standing disputes have
revolved around whether clients served by other public agencies,
such as the courts and the Department of Economic Security, can
access all behavioral health services requested by the other agen-cies,
and whether such services are appropriate for clients’ needs.
During the 1990s, many different efforts, mostly focused on chil-dren’s
services, were launched to examine various aspects of the
coordination between the State’s behavioral health care system
and other state agencies. Several efforts were outgrowths of a
1991 Arizona Federal District Court case (JK v. Griffith, No. Civ
91-261) alleging that Medicaid-eligible children were not receiv-ing
adequate or appropriate behavioral health care.
Disputes have revolved around
whether clients can access all
behavioral health services
requested by other agencies.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
2
These previous efforts addressed a wide variety of issues related
to coordination of services among state agencies. Recommenda-tions
were made to address problems such as duplication of
efforts and poor communication among agencies. (Other Perti-nent
Information, pages 43 through 54, describes the efforts and
recommendations more fully.) While some of these efforts
showed that clients referred from other state agencies do not
always receive appropriate or adequate services, these other
efforts did not focus on why clients referred to the behavioral
health system may not always receive the services other state
agencies believe they need.
This audit attempts to develop explanations for why people
referred for behavioral health services cannot always access re-quested
services, or receive more limited treatment than other
agencies believe to be necessary. It makes recommendations
pertaining to how the State might improve service accessibility
for people referred to the behavioral health system, and ensure
that the duration and level of care provided are appropriate.
To identify common themes explaining why clients from other
agencies cannot always access requested services, auditors ex-amined
the problems encountered in providing services to peo-ple
such as the following:
Irene
Irene has cerebral palsy and requires a
wheelchair to get around. Although at
one time she lived in her own apart-ment
while attending community
college, she has been hospitalized for
major depression with psychotic fea-tures
and is now under a court order to
receive behavioral health services.
However, the State’s behavioral health
care system has had difficulty supply-ing
these services, because Irene must
have a wheelchair-accessible facility
where staff has the necessary training
to assist her with both her physical and
behavioral health needs.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
3
RBHAs—Do not receive
fees for services, instead
they receive a fixed dollar
amount per eligible person
per month.
Behavioral Health Services in Arizona
This introduction describes how the study was conducted and
how its findings are presented. It also provides an overview of
how the State’s behavioral health services delivery system is
organized.
Division of Behavioral Health Services provides services
through Regional Behavioral Health Authorities—Arizona Re-vised
Statutes (A.R.S.) §36-3403
requires the Division of Behav-ioral
Health Services to
administer a unified mental
health program, including the
state hospital and community
mental health. To carry out this
charge, BHS oversees a managed care system administered by
five contracted organizations called Regional Behavioral Health
Authorities (RBHAs). The RBHAs are similar to health mainte-nance
organizations in that they do not receive fees for services.
Instead, they receive a fixed dollar amount per eligible person
per month (a capitated rate) for Medicaid and KidsCare clients,
Maria
Maria is a 17-year-old with numerous
behavioral health problems. Physically
and sexually abused as a child, she was
hospitalized for suicidal tendencies at
the age of 13. Over one year later, ad-dicted
to crack cocaine and other sub-stances,
she gave birth to her first child,
who was born medically impaired. At
16, she was pregnant again. Although
Maria met eligibility requirements for
state-provided drug-treatment services,
she had difficulty obtaining them.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
4
and a fixed amount for serving clients who do not quality for
these two programs. RBHAs in turn contract with more than 350
service providers to provide the actual services.
The Division of Behavioral Health Services, through its RBHAs,
is responsible for providing services to several categories of enti-tled
clients.
n The Division is responsible for supplying medically neces-sary
behavioral health services to Medicaid clients in the
State through a contract the Division has with the Arizona
Health Care Cost Containment System (AHCCCS).
n BHS is also responsible for providing services to develop-mentally
disabled Arizona Long Term Care System (ALTCS)
recipients through a contract it has with the Department of
Economic Security’s Division of Developmental Disabilities
(DDD).
n Furthermore, the Division of Behavioral Health Services is
responsible for providing all needed behavioral health serv-ices
and additional services, such as vocational services and
housing, to adults with serious mental illness (SMI), regard-less
of their Medicaid status. This latter requirement is out-lined
in A.R.S. §36-3407, and is currently enforced under a
court order for persons living in Maricopa County, based on
the Arnold v. Sarn lawsuit.
The Division of Behavioral Health Services is also responsible for
providing care to KidsCare recipients. Under this program, eligi-ble
children can receive a total of 30 days of inpatient and 30
units of outpatient behavioral health services. Finally, the Divi-sion
also provides services to other persons who do not qualify
for Medicaid, ALTCS, or KidsCare, as funding allows.
Other agencies’ involvement with the Division—Many of the
clients involved in the behavioral health system have multi-agency
involvement. These mutual clients are often referred to
the RBHAs for services by the other state agencies serving them.
These other state agencies include:
n Division of Developmental Disabilities (DDD)—A unit of
the Department of Economic Security, this agency is respon-
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
5
sible for about 17,000 persons with developmental disabilities
such as mental retardation, cerebral palsy, and epilepsy. Of
these clients, over 10,000 are ALTCS enrollees.
n Child Protective Services (CPS)—Also a unit within the
Department of Economic Security, this agency served ap-proximately
33,000 families and provided out-of-home care
to approximately 6,700 children and youth in fiscal year 1998.
CPS investigates allegations of child abuse and neglect, pro-vides
in-home family support and preservation services, and
provides foster care and other services for children removed
from their families.
n Department of Juvenile Corrections—Juvenile Corrections
supervises 700 youth offenders. Each year, the Department
also supervises 2,500 youth on parole, and transitions these
youth back into the community once they are released from
one of the Department’s seven secure facilities.
n Administrative Office of the Courts—The Supreme Court’s
Administrative Office of the Courts administers statewide
adult and juvenile probation services, which are operated at
the individual county level. In 1998, adult probation offices
supervised approximately 35,000 probationers. During that
same year, juvenile probation offices supervised 9,000 proba-tioners.
Additional agencies also refer clients to the RBHAs for behav-ioral
health treatment. These agencies include AHCCCS, whose
clients may be referred to the RBHAs through contracted medi-cal
care providers, and the Department of Education, whose
students may be referred to the behavioral health care system by
individual school districts.
Although agencies often do refer clients to the behavioral health
care system for treatment, this is not always the case. Sometimes,
other state agencies pay for behavioral health services them-selves.
In interviews conducted with other agency officials, they
noted that referrals usually are not made if clients are not eligible
for Medicaid. In addition, other state agencies often do not refer
clients for behavioral health treatment when Medicaid does not
cover a service that the agency or a court order deems appropri-ate
for the client. Further, these agencies (particularly Juvenile
Corrections) may not refer clients for services if the agency has
Sometimes other state
agencies pay for behavioral
services.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
6
had historic difficulties accessing such services. (See Finding IV,
pages 39 through 42).
Other state agencies also pay for behavioral health services for
clients who are referred but not able to access services deemed
necessary by the referring agency. In still other cases, the RBHAs
and other state agencies share the costs of providing services. For
example, the Department of Economic Security’s Child Protec-tive
Services may pay for room and board costs associated with a
child residing in a therapeutic group home, while BHS pays for
the behavioral health services provided at the facility. According
to agency officials at the Department of Economic Security, the
Department of Juvenile Corrections, and BHS, the use of such
cost-sharing agreements has increased dramatically over the past
two years. BHS and other state agencies regard such agreements
as holding great promise for reducing interagency disputes.
Other state agencies’ spending on behavioral health services
appears to vary in magnitude. For example, the Department of
Economic Security’s Division for Children, Youth, and Families
expended approximately $11 million and the Department of
Juvenile Corrections over $2 million for behavioral health serv-ices
in fiscal year 1999. DDD spent approximately $100,000 in
non-ALTCS monies. BHS spent approximately $308 million in
Medicaid, KidsCare, and all other monies on behavioral health
services during that same period.
Audit Scope and Methodology
To assess the coordination of behavioral health services among
state agencies, the audit focused on determining reasons why
clients referred by other state agencies for services do not always
receive services through the RBHAs. To do so, a combination of
audit methods was used. However, the central method of this
audit was conducting in-depth case studies.
Case study method—A case study is a method for learning about
a complex instance, based on a comprehensive understanding of
that instance obtained by extensive description and analysis of
The use of cost-sharing
agreements has increased
dramatically.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
7
that instance taken as a whole and in its context.1 Recently, case
studies have gained increased attention for the value they have
in exploring the reasons behind problems common to complex
organizations. A congressional committee, for example, used a
case study approach in 1991 to study fraud and abuse in the
insurance industry in order to determine causes of insurance
company failures. In this audit, case studies were used to dis-cover
explanations for disagreements between agencies regard-ing
services for referred clients, and to determine what appropri-ate
actions can be taken.
Case studies can be used for a variety of purposes. They have
been used primarily to isolate complex causal elements, as they
were used in this audit. They can also be useful to compare
across various sites, such as the various agencies making refer-rals
to the RBHAs. The benefits of case studies include their abil-ity
to encompass the context in which events occur, as well as the
small but significant differences that can be obscured in large-scale
statistical analysis. Thus the case study was an ideal
method to provide information and explanation for some of the
problems identified in the many previous studies of Arizona’s
behavioral health system.
For the audit, ten individuals in the behavioral health care sys-tem
were selected as case studies. The group of ten, which in-cludes
both adults and children, all met three basic criteria:
n They were clients who entered the behavioral health care
delivery system through agencies other than BHS.
n They either were eligible for Medicaid or were thought to be
eligible for Medicaid when they entered the system.
n They had difficulty in obtaining needed services.
1 United States General Accounting Office, Case Study Evaluations,
GAO/PEMB-91-10.1.9, November 1990 (page 15).
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
8
Clients selected for the case-study review came from DDD, CPS,
Juvenile Corrections, and the Administrative Office of the
Courts.1
After identifying and selecting cases, auditors used a structured
protocol to review documentation from numerous sources, in-cluding
referring agency files, RBHA files, and records regarding
Medicaid eligibility. To ensure they had a clear picture of the
treatment histories, auditors also interviewed multiple people
who were familiar with each case, including RBHA case manag-ers,
officials from referring agencies, and service providers to
determine why clients were not able to receive needed services.
Supplementary methods—To supplement this case-study ap-proach
with a broader review that would help set the findings in
context, auditors also conducted the following work:
n Reviewing reports by legislative committees, multi-agency
councils, nonprofits, and experts on coordination problems
between state agencies and BHS;
n Interviewing Health Care Financing Administration and
AHCCCS officials;
n Attending work groups on coordination problems between
agencies;
n Examining intergovernmental agreements, protocols, estab-lished
guidelines, policies, rules, and statutes related to be-havioral
health service delivery;
n Examining entitlement requirements for behavioral health
services;
n Reviewing the State’s Medicaid plan and BHS’ strategic plan
for substance abuse provision;
1 Time constraints and limited audit resources did not permit drawing
cases from all possible referring agencies or from every RBHA. Also,
time constraints limited the review of probationers from the Admin-istrative
Office of the Courts to adult probationers, although some
Juvenile Corrections cases reviewed also contained information on
clients’ experiences in the juvenile probation system.
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
9
n Interviewing representatives and conducting focus groups to
solicit the views of mental health advocates, providers, and
agency representatives;
n Reviewing literature on medical necessity definitions, rural
behavioral health care, and behavioral health treatment and
diagnosis;
n Examining BHS service matrixes and service authorization
codes; and
n Reviewing information provided by the Department of
Health Services’ Division of Assurance and Licensure on
changes in licensed providers.
The audit contains three findings on reasons why clients referred
by other agencies cannot always access services from the behav-ioral
health system, and recommendations on changes needed
to make the system more accessible. Specifically, the findings
discuss:
n Issues related to the behavioral health system’s design that
affect the ability of referred clients to access some services
(see Finding I, pages 11 through 21);
n Uncertainty about who is eligible to receive Medicaid-provided
services and about which services Medicaid will
provide (see Finding II, pages 23 through 32); and
n Lack of provider services for some clients (see Finding III,
pages 33 through 38).
The report also contains a fourth finding, pertaining to possible
savings of state dollars if BHS takes a greater role in providing
services to juvenile offenders, parolees, and probationers (see
Finding IV, pages 39 through 42). Finally, the report contains
Other Pertinent Information on the numerous studies and work
groups formed in recent years to review issues related to the
coordination of behavioral health services across agencies, and
common recommendations from these work groups. (See Other
Pertinent Information, pages 43 through 54.)
Introduction and Background
OFFICE OF THE AUDITOR GENERAL
10
Audit Limitations
While this audit focused on why clients referred by other state
agencies are not always able to access services from the behav-ioral
health system, it could not determine how frequently clients
cannot receive requested services. At the time of the audit, the
Division of Developmental Disabilities, Juvenile Corrections,
county adult probation offices, and Child Protective Services did
not track cases referred to the behavioral health system for serv-ices.
As a result, auditors could not estimate the frequency at
which such denials occur. Nonetheless, previous independent
evaluations of the care that behavioral health clients receive have
noted instances where clients with multiple agency involvement
did not receive adequate services.
This audit was conducted in accordance with government
auditing standards.
The Auditor General and staff express appreciation to the Acting
Director of the Department of Health Services, the Assistant
Director of the Division of Behavioral Health Services, and offi-cials
at the Department of Juvenile Corrections, the Department
of Economic Security, the Administrative Office of the Courts,
and county probation offices for their cooperation and assistance
throughout the audit.
OFFICE OF THE AUDITOR GENERAL
11
FINDING I MANAGED CARE FOCUS, AND
STRUCTURE THAT DIVIDES
RESPONSIBILITY, LEADS TO
INTERAGENCY DISAGREEMENTS
The managed-care focus and multi-agency structure of Arizona’s
behavioral health care system is inherently vague and leads to
conflict over whether clients referred by other agencies should
receive care from the Division of Behavioral Health Services
(BHS). The managed-care system provides some incentive for
limiting care and mandates that services be provided only when
“medically necessary,” a concept that is vague and open to dis-pute.
Blurred roles among agencies and the potential for other
agencies to pay for services that BHS does not provide also lead to
disputes over which agency should provide services to clients.
Auditor General staff identified three options that could help
mitigate some of these sources of dispute:
n Eliminating some of the divided responsibility among agen-cies;
n Improving and standardizing assessments of behavioral
health clients’ conditions; and
n Improving oversight of services provided by Regional Behav-ioral
Health Authorities (RBHAs).
System’s Inherent Vagueness
Leads to Disagreements
After examining the case studies in depth, interviewing agency
officials and other interested parties, and examining the results of
other recent study efforts, three primary factors emerged as con-tributing
to interagency disagreements. The first is the system’s
managed-care focus, which provides some incentive to limit care
and control costs. The second factor, which naturally follows the
first, is that the behavioral health system is focused on providing
only “medically necessary” services, which is a requirement for
coverage under the federal Medicaid program. The concept of
Finding I
OFFICE OF THE AUDITOR GENERAL
12
“medical necessity” is inherently vague and open to conflict. Fi-nally,
divided responsibilities and funding create incentives for
cost-shifting between agencies.
Managed care system creates some incentive to limit care—Ari-zona’s
managed behavioral health care system creates some in-centive
for the RBHAs and/or their providers to limit care, thus
contributing to conflict between agencies.1 Officials and case man-agers
from other agencies and providers often stated in interviews
that services provided by the RBHAs were too limited in duration
or intensity to meet clients’ needs. It was alleged that efforts by the
RBHAs to continually review and authorize services would
sometimes cut off services prematurely or inappropriately. Also,
representatives from another agency said that the RBHAs provide
only a limited scope of services, when a fuller array of services
would appear to be justified.
The State’s behavioral health care system does indeed limit the
duration and scope of services. State law has established a system
of health care in Arizona designed to control costs. 2 Accordingly,
BHS/RBHA contracts require the RBHAs to ensure that services
are provided in the least restrictive settings possible. For example,
a client should not be confined in a psychiatric hospital if he or she
can be treated equally well as an outpatient. In addition, the sys-tem
for funding behavioral health services in this State creates
some incentive to limit care. The RBHAs are paid a fixed sum of
money in advance for serving Medicaid-eligible people in their
geographic region, and incur a loss if they spend more than they
receive. As a result, RBHAs protect their limited funds by moni-toring
service utilization, requiring authorization for services be-yond
pre-defined limits, and denying services when the need for
1 In some cases, the RBHAs share the risk of providing services with
their contracted providers. The Community Partnership of Southern
Arizona and the Northern Arizona Regional Behavioral Health
Authority each pay their contracted providers in advance for pro-viding
all services to a defined number of clients.
2 See A.R.S. §§36-2903, 36-2907, and 36-2989.
RBHAs are required to ensure
that services are provided in the
least restrictive setting.
Finding I
OFFICE OF THE AUDITOR GENERAL
13
Medical Necessity—How Is It Defined?
In BHS’ most recent RBHA contract, medically neces-sary
covered services are defined as services that are:
n Provided by the practitioners within the scope of
their practice to prevent disease, disability, and/or
other adverse health conditions or their progres-sion;
n Promoting progress toward the highest possible
level of health and self-sufficiency;
n Reasonably expected to benefit the eligible person’s
mental or physical health;
n Necessary and appropriate to the eligible person’s
present condition;
n Designed to assist eligible and enrolled persons to
manage their illness to the extent possible and to
live, learn, and work in their own communities.
The contract further states that a “covered service is
medically necessary if there is no equally effective
service that is less restrictive or substantially less costly.
Services shall not be denied based on ‘medical neces-sity’
solely because the enrolled person has a poor
prognosis or has not shown improvement if the cov-ered
services are necessary to prevent regression or
maintain their present condition.”
services is unclear or when it appears that another agency could
provide the service. 1
While the State’s behavioral health care system is designed to
control costs, it is questionable whether it is limiting services so
much that the care delivered is sometimes inappropriate in type
or duration. Because auditors reviewed a limited number of cases
referred for services by other agencies, it was impossible to con-clusively
answer this question. However, other studies performed
recently do suggest that care may sometimes be inappropriately
limited for clients referred from
other agencies to the State’s be-havioral
health care system. An in-depth
independent review of
Maricopa County’s behavioral
health system for Medicaid chil-dren
performed in 1998 as part of
the JK v. Griffith lawsuit noted:
“(The) current service pattern is to
under-serve children by delivering
episodic treatment and crisis
services even though…a more
comprehensive and continuous
intervention strategy is required to
prevent harm and achieve satisfac-tory
results.”
The study also found that
underservice was especially pro-nounced
for children involved with
the juvenile justice, developmental
disability, and child welfare
systems. Children with
developmental disabilities received
the least acceptable services of
these groups.
1 Some of the incentive to limit care is mitigated by BHS/RBHA con-tractual
clauses that allow the Division to adjust capitation rates or
payments to the RBHAs if losses are too great. Further, contractual
limits on the amount of profit that can be realized by the RBHAs
further guard against underservice.
Finding I
OFFICE OF THE AUDITOR GENERAL
14
Medical necessity often the source of denials, disputes—To help
control costs, each RBHA is required by contract with BHS and by
Medicaid rules to deliver only those services that are “medically
necessary,” meaning that services must be expected to benefit the
client’s mental or physical health, and should be delivered in the
least restrictive setting proven or predicted to be effective in
meeting the clients’ behavioral health needs in order to conserve
costs. The different opinions among RBHAs, the courts, and state
agencies over which services are medically necessary appear to be
a common reason for disputes over services received by clients
who have been referred by other agencies. “Medical necessity” is
defined quite broadly in this State (see highlighted information on
page 13), allowing the RBHAs much discretion in interpreting the
medical necessity of individual services. While this broad defini-tion
may result in differences of opinion regarding whether serv-ices
are medically needed, it also appropriately allows an array of
services to be covered under Medicaid reimbursement.
In many of the reviewed cases, disagreements centered on a
RBHA’s decision to terminate or refuse to approve behavioral
health treatment because the service was not deemed “medically
necessary.” These disputes frequently occur regarding continued
placements in costly residential treatment settings. Representa-tives
from other state agencies often disagreed with the RBHA’s
interpretation. For example:
Todd
Todd, a 15-year-old client with aggressive, hyperactive behaviors,
had his services terminated at a residential treatment center after
eight weeks. The RBHA stated that out-of-home treatment was no
longer medically necessary. Todd’s court-appointed psychiatrist
and his CPS caseworker believed he needed intense treatment in a
confined setting, such as the residential treatment center, because
he was in danger of fleeing and because of his conflicts with staff at
group homes where he had stayed in the past. They said it was
inappropriate for him to receive care at home due to problems
with his family. The psychiatrist assigned to Todd by the RBHA
disagreed, saying that because he did well when removed from
his family and placed in a confined setting, problems with his
parents and inappropriate foster care placements may explain his
behavior. In the RBHA psychiatrist’s opinion, treatment was
needed, but placing Todd in the residential treatment center did
not meet “medical necessity.”
Finding I
OFFICE OF THE AUDITOR GENERAL
15
Multiple funding streams create opportunities for cost-shifting—
Although the Division is the primary agency responsible for pro-viding
publicly funded behavioral health services, other agencies
sometimes purchase behavioral health services for their Medicaid-eligible
clients, raising questions about who should pay for a par-ticular
service.1 RBHAs can reduce their spending if they transfer
payment responsibility to another agency. In one of the ten cases
auditors reviewed in detail, the RBHA appeared to inappropri-ately
be attempting to shift the costs of behavioral health treat-ment
to another agency:
Interviews with behavioral health professionals confirm that
cost-shifting sometimes occurs. For example, a RBHA psychia-trist
indicated that children who have conduct disorders or who
have committed sexual offenses and are referred to the RBHA
for possible Medicaid-provided care are traditionally shifted to
other agencies because the other agencies have money to pay for
treatment.
1 The Division currently receives federal- and state-appropriated
dollars to provide behavioral health services to Medicaid-eligible
members of AHCCCS health plans. Medicaid dollars are received
through the Division’s contract with AHCCCS, Arizona’s designated
Medicaid agency. Arizona Long Term Care System dollars for
ALTCS-eligible Developmental Disabilities clients are also received
directly from AHCCCS. BHS provides services for DDD ALTCS cli-ents
through an interagency agreement between DDD and BHS.
Irene, a 25-year-old developmentally
disabled client, was referred by the
Division of Developmental Disabilities
(DDD) for services to be provided
through a RBHA. The RBHA denied
that Irene had a serious mental illness,
stating that Irene’s problems were due
to mental retardation, not depression.
When RBHA staff learned that Irene
did not have mental retardation, they
asserted that her behavioral health
problems were due to cerebral palsy.
Irene
Finding I
OFFICE OF THE AUDITOR GENERAL
16
Habilitative Treatment—
care that brings clients to a
new, higher level of func-tioning.
Rehabilitative Treatment—
care that restores clients to
their former level of func-tioning.
In some cases, disputes over who should pay may also be attrib-uted
to narrow and unclear distinctions between agencies’ roles.
For example, one high-level
DDD administrator explained
that DDD provides habilitative
treatment for its clients, while
RBHAs are responsible for pro-viding
rehabilitative treatment.
The administrator admitted that
it can be very difficult to distin-guish
the difference between a
client’s needs for habilitative
versus rehabilitative services. Interviews, case studies, and lit-erature
also suggest that the distinction between a developmen-tal
disability and a behavioral health problem can be difficult to
distinguish.
Changes Could
Diminish Some Disagreement
Changes in the current behavioral health delivery system could
eliminate some of the disputes between agencies and result in
more accessible, appropriate, and integrated treatment for indi-viduals.
Specifically, improvements may occur by:
n Transferring responsibility for some clients’ behavioral health
services from BHS to DDD.
n Revising RBHA and other agencies’ assessment practices.
n Enhancing BHS’ oversight of the RBHAs to help ensure that
treatment for interagency clients is appropriate in type and
duration.
Transferring responsibility could eliminate some conflict— By
allowing some other agencies to contract directly with provid-ers
for the behavioral health treatment for their Medicaid cli-ents,
interagency conflict could be diminished. Although other
groups of clients with multi-agency involvement might also
benefit from carving out treatment, this could most easily occur
for DDD clients in the Arizona Long Term Care System
(ALTCS). Currently, DDD has an intergovernmental agreement
Finding I
OFFICE OF THE AUDITOR GENERAL
17
with BHS to provide behavioral health services for such clients
through the RBHAs. Because of this separate capitation rate set
by AHCCCS and an existing information system for reporting
DDD/ALTCS services to AHCCCS, DDD would need to make
fewer changes in its administration and contract monitoring
practices than other agencies might need to make.
“Carving out” DDD/ALTCS clients from the behavioral health
system may make sense for other reasons, too. Differences be-tween
problems associated with a client’s developmental dis-ability
versus any diagnosed behavioral health problems can be
difficult to determine. Indeed, an independent study of Medi-caid
service provided to children in Maricopa County for the JK
v. Griffith lawsuit stated:
“A developmental disability is a life-long condition while a
mental illness may be episodic and controllable with medica-tions.
Each diagnosis requires supports, services and treatments
that are appropriate and effective for each condition—the first
using a developmental, supportive approach and the other using
an interventive, therapeutic approach. These dual requirements
are difficult to manage across the boundaries of different state
agencies.”
Finally, transferring responsibility for the provision of behav-ioral
health care back to DDD for its ALTCS clients makes sense
for these more than other agencies’ clients for another reason.
The independent study noted above pointed out that DDD
children eligible for Medicaid are the least likely among groups
of children with multi-agency involvement to receive appropri-ate
treatment from the behavioral health system.
Transferring responsibility was discussed seriously in 1994-
1995 by BHS, DDD, and AHCCCS. A joint task force met sev-eral
times to develop a plan for transferring DDD clients who
were eligible for ALTCS from BHS to DDD for their behavioral
health services. An internal study by DDD had found that its
ALTCS clients were more likely to be denied services by the
RBHAs than other DDD clients. However, a pilot project
scheduled to begin on October 1, 1995, was never implemented.
Because such a transfer could make behavioral health services
more available to DDD ALTCS clients, the transfer could result
Finding I
OFFICE OF THE AUDITOR GENERAL
18
in increased costs to the State. Currently, DDD estimates that
almost 18 percent of its ALTCS clients receive behavioral health
services. In the 1995 study, DDD estimated that if it provided
behavioral health services to its ALTCS clients, 30 percent of its
ALTCS clients would utilize services. Although costs might
increase if service use grows, accurately projecting the in-creased
cost to the State would require an actuarial study simi-lar
to those conducted to prepare for Medicaid capitation rate
negotiations with the Health Care Financing Administration. If
the Legislature favors the transfer of responsibility in principle,
it could authorize DDD, BHS, and/or AHCCCS to contract
with an actuarial firm for such a study.
Changing assessments—By changing the way that clients’ con-ditions
are assessed by other state agencies and BHS, disputes
over whether a client is suffering from a behavioral health prob-lem
could be diminished. Other agencies sometimes perform
their own assessments of clients’ behavioral health problems and
needs. However, these assessments are performed in different
ways depending on the agency completing them, potentially
resulting in diverging opinions of clients’ conditions and treat-ment
needs. This often occurs with individuals who are involved
with the courts, and are court-ordered for a psychiatric evalua-tion.
While the courts and their contracted psychiatrists may
determine that an individual suffers from a particular behavioral
health problem and needs certain types of treatment, the RBHAs
are under no obligation to provide such treatment and may
reach different conclusions regarding the referred client’s condi-tion
and needs.
A group established out of the JK v. Griffith litigation is proposing
that children’s agencies cover a core set of assessment elements
and screening for other service needs when conducting initial
assessments. The group is recommending that this information
be available to all agencies. Such a procedure could also be modi-fied
and used by agencies conducting adult assessments.
The RBHAs’ use of more qualified medical health professionals
could also increase confidence in the RBHAs’ determinations of
whether clients referred for services have behavioral health
problems and whether services are medically necessary. Inde-pendent
studies performed in the past have found that RBHAs
do not always perform adequate assessments of clients’ condi-
Assessments are performed in
different ways depending on
the agency completing them.
Finding I
OFFICE OF THE AUDITOR GENERAL
19
tions, resulting in inaccurate diagnoses and incomplete treatment
plans. For example, in 1995, independent psychiatrists found in
their review of treatments delivered to Medicaid recipients that
there was “room for improvement in diagnostic accuracy.” The
same group formed out of the JK v. Griffith lawsuit, which is
recommending common assessment tools, also recommends that
more qualified people perform assessments.
Currently, BHS requires the Maricopa County RBHA to have
master’s-level behavioral health professionals perform assess-ments
and BHS is considering requiring other RBHAs to meet
such a requirement. However, interviews with officials from that
RBHA and others suggest that the RBHAs may find it difficult to
fulfill this requirement due to the expense and problems in re-cruiting
master’s-level caseworkers. BHS should assist the
RBHAs in developing a plan for fulfilling the current master’s-level
caseworker requirements, or develop alternative methods
of ensuring that those people who perform assessments are ade-quately
qualified.
BHS may also need to make changes to ensure that adults re-ferred
for services in the behavioral health system have adequate
time to submit medical records before medical professionals
determine whether the person is to be designated “seriously
mentally ill.” Currently, Arizona Administrative Code Title 9,
Chapter 21 states that persons seeking seriously mentally ill
status have seven days to submit medical records before a de-termination
is to be made. Such a narrow time frame may not be
long enough for people to obtain necessary medical records,
thereby limiting the RBHAs’ ability to review clients’ medical
histories and other psychiatrists’ opinions before making deter-minations
about whether an individual’s status can be classified
as “seriously mentally ill.”
Enhanced oversight of RBHAs—Greater oversight of RBHAs by
BHS could help ensure that services are not inappropriately de-nied
or limited. BHS has developed service guidelines outlining
care that clients should typically receive. Literature suggests that
such guidelines may be useful to prescribe typical client care and
to ensure that clients receive appropriate and sufficient services.
While individual care may differ from such guidelines, they
could be used to ensure that the majority of clients with specific
types of illnesses receive the treatment deemed appropriate by
Adequate time is needed to
submit medical records.
Finding I
OFFICE OF THE AUDITOR GENERAL
20
BHS. Maricopa County’s new RBHA contract actually requires
that services be delivered according to guidelines. However, it
appears from an interview with a Maricopa County RBHA
treatment team member that service guidelines are not con-sulted.
Also, the Division needs to carry out its plans to monitor
whether the care that people receive from the RBHAs mirrors
these service guidelines.
Also, BHS should better monitor whether RBHAs are making
appropriate decisions as to whether behavioral health clients
should be receiving inpatient hospital and other inpatient serv-ices
such as those provided in residential treatment centers. BHS
has developed level-of-care criteria outlining when clients
should receive intensive, costly inpatient and residential treat-ment.
Nonetheless, while such criteria have been developed, the
Division has not yet begun monitoring whether clients seeking
such care are receiving or being denied such services based on
the criteria.
Finding I
OFFICE OF THE AUDITOR GENERAL
21
Recommendations
1. The Legislature should consider directing DDD, BHS,
and/or AHCCCS to contract with an actuarial firm to deter-mine
the cost of having DDD contract directly with providers
for its ALTCS clients’ behavioral health services, instead of
relying on the RBHAs to deliver such services. If the Legis-lature
finds the projected cost to be acceptable, DDD should
begin directly contracting for such services for its ALTCS cli-ents.
2. BHS should continue to work with other agencies to develop
methods for streamlining and coordinating assessment of
children, as is currently occurring under the JK v. Griffith liti-gation.
BHS should also work with agencies that conduct
adult screening and assessments to ensure that the agency’s
assessment information is routinely available and incorpo-rated
into the RBHA’s assessment process.
3. BHS should assist the RBHAs in developing a plan for ful-filling
the current master’s-level assessment requirements, or
develop alternative methods of ensuring that people who
perform behavioral health assessments are adequately quali-fied.
4. BHS should make changes to Title 9, Chapter 21 of the Ad-ministrative
Code, allowing people applying for Seriously
Mentally Ill (SMI) status more time to submit medical records
so that past medical histories and other psychiatrists’ opin-ions
can be adequately considered.
5. BHS should monitor whether care delivered by the RBHAs
reflects the Division’s service planning guidelines.
6. The Division should monitor whether the RBHAs are cur-rently
using BHS level-of-care criteria when making deter-minations
as to whether clients qualify for inpatient and resi-dential
treatment.
OFFICE OF THE AUDITOR GENERAL
22
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OFFICE OF THE AUDITOR GENERAL
23
FINDING II CONFUSION EXISTS
REGARDING MEDICAID
COVERAGE
A second reason why some clients referred from other agencies
may not receive some services, apart from the systemic problems
described in Finding I (see pages 11 through 21), is that some
basic confusion exists about which services are available for
Medicaid recipients and who is covered by Medicaid. RBHAs
are denying some services, particularly for substance abuse,
because it is not clear if Medicaid covers services in certain cir-cumstances.
Also, some clients referred by the courts and Juve-nile
Corrections may not be receiving services because the refer-ring
agency assumes the client is enrolled in Medicaid when that
is not the case. This lack of clarity limits the degree to which
Medicaid recipients can obtain mental health treatment, and it
also shifts expenditures from Medicaid, which is largely funded
by the federal government, to programs funded entirely by the
State. To resolve the situation, BHS should clarify its policy about
which services Medicaid will cover. Changes in the capitation
rate structure could also help diminish confusion regarding who
is eligible to receive substance abuse services. The courts and
Juvenile Corrections should also take steps to ensure that their
personnel can identify people who are eligible for and enrolled
in Medicaid.
Medicaid Covers a Wide
Range of Services
In Arizona, Medicaid can pay for a wide range of services in a
variety of settings as long as these services are deemed “medi-cally
necessary.” These services range from inpatient hospital
services to professional services such as therapy and counseling,
to rehabilitation services such as assistance with daily living
activities and household services (see Exhibit 1, page 24). These
services are available to both children and adults. Further, these
services are available for people suffering from any type of be-havioral
health problems in which a person could benefit from
treatment, including substance abuse problems.
Finding II
24
OFFICE OF THE AUDITOR GENERAL
Exhibit 1
AHCCCS and ADHS Division of Behavioral Health Services
Behavioral Health Services Covered by Medicaid
INPATIENT SERVICES
¨ Hospital Services: Treatment of acute episodes, generally of a short duration, in an acute general hospital.
¨ Psychiatric Facility Services: The facility may be an inpatient residential treatment center or an inpatient psychiatric
hospital accredited by the Joint Commission on Accreditation of Health Care Organizations under inpatient standards.
Services in these facilities are covered only for persons under 21 years of age.
¨ Institution for Mental Disease (IMD) Services: Treatment includes medical attention, nursing care, and related
services. The facility may be a hospital, nursing facility, or other institution with more than 16 beds engaged in di-agnosing
and treating persons with mental diseases, including substance abuse/dependence. An institution for the
mentally retarded is not an institution for mental disease. IMD services are covered only for persons under 21
years old or 65 years and older.
PROFESSIONAL SERVICES
¨ Therapy and counseling: Individual therapy and group and/or family therapy and counseling provided by be-havioral
health professionals or behavioral health technicians.
¨ Psychotropic medication adjustment and monitoring: Review of effects and side effects of medication and adjustment
of dosages overseen by licensed medical professionals.
REHABILITATION SERVICES
¨ Basic Partial Care Services: A regularly scheduled therapeutic services program provided in a group. Services include
psychosocial rehabilitation, supportive counseling and other activities to promote coping, problem solving, and independ-ent
living and socialization skills to prevent placement in more restrictive settings.
¨ Intensive Partial Care Services: A regularly scheduled treatment program including individual, group and/or family
therapy, psychiatric services, and other therapeutic activities provided in a group setting under the direction of a psychia-trist
or psychologist to address acute or episodic behavioral health problems or to prevent placement in more restrictive
settings.
¨ Behavior Management Services: Therapeutic supervision and direction provided to prevent placement in a more restric-tive
setting. May include assistance with activities of daily living and household services.
¨ Psychosocial Rehabilitation: Treatment to develop community and daily living skills. Skill areas include attention and
concentration, interpersonal relations, socialization, understanding and use of medication, symptom management, use of
leisure time, and ability to use community resources.
¨ Emergency/crisis behavioral health services: Immediate and intensive, time-limited, community-based, face-to-
face crisis intervention services available on a 24-hour basis in situations where a person is a danger to self or
others.
OTHER SERVICES
¨ Screening and Evaluation Services
¨ Case Management Services
¨ Emergency and non-emergency transportation services
¨ Psychotropic medications
¨ Methadone administration
¨ Laboratory and radiology services
RESTRICTIONS ON TREATMENT SETTINGS
¨ Other non-hospital residential settings: Medicaid pays only for behavioral health services, not room and board
in non-hospital residential settings which are not IMDs when used to treat eligible persons age 21 through 64. Ex-amples
of non-hospital residential settings include: residential treatment centers; therapeutic group homes; inten-sive
adult residential; 24-hour supervised adult residential, semi-supervised independent living; 8-hour and 16-
hour facilities; substance abuse residential treatment centers; supported community living centers. Medicaid does
pay for room and board charges for children in residential treatment centers.
Source: Auditor General staff analysis of Arizona Administrative Code, Title 9, Chapter 22, Article 12. AHCCCS
Behavioral Health Rules; ADHS/DBHS Service Matrix, July 1999; and Value Options’ Integrated Behav-ioral
Health Services RFP, July 1999.
Finding II
OFFICE OF THE AUDITOR GENERAL
25
Coverage for Substance Abuse,
Other Services Misunderstood
While Arizona’s Medicaid program offers a wide range of serv-ices
to clients enrolled in Medicaid, actual delivery of such serv-ices
may be limited by confusion and lack of clarity over what
services are covered. In particular, confusion exists in four spe-cific
circumstances described below.
n Medicaid clients, such as seriously mentally ill adults,
adults with general mental health disorders who do not
meet SMI eligibility criteria, and children, are entitled to
receive substance abuse services—All Medicaid-eligible
clients are entitled to receive all medically necessary services,
including substance abuse treatment. However, according to
BHS’ medical director, confusion exists as to whether adults
who are enrolled as SMI clients can receive substance abuse
treatment, and whether children can receive substance abuse
treatment. Other high-level BHS officials also corroborated
this confusion.
BHS’ medical director suggested that at least two factors
contribute to the confusion:
4 Method of capitating Medicaid payments to the
RBHAs—Currently, different capitation funding catego-ries
exist for children, seriously mentally ill adults, and
adults suffering from general mental health or substance
abuse problems. According to the medical director, this
split may incorrectly imply that children or seriously
mentally ill adults are not eligible for substance abuse
services.
4 Structure of the provider network—Particularly in
Maricopa County, the structure of the provider network
may also contribute to confusion over whether seriously
mentally ill adult clients can receive substance abuse
services. Especially in Maricopa County, providers have
typically been identified as either providers for SMI
adults or substance-abusing adults. Little integration or
coordination occurs between substance abuse providers
and the providers of behavioral health treatment for the
seriously mentally ill. Therefore, people who have his-
Finding II
OFFICE OF THE AUDITOR GENERAL
26
torically been referred to a provider serving seriously
mentally ill adults may have been told that there was no
substance abuse treatment available for them. BHS and
the new RBHA in Maricopa County are planning to cre-ate
integrated networks of substance abuse and mental
health treatment providers, so that clients referred for one
type of treatment will be more easily referred to other
types of treatment. This is a part of a larger initiative the
Division has been undertaking over the past year to en-sure
the appropriate treatment of persons with substance
abuse and mental health problems.
n Substance abuse services alone can be provided to cli-ents
without an additional mental health diagnosis—It
appears that some RBHA staff incorrectly believe that Medi-caid
clients must be diagnosed with a mental health problem,
such as depression, to qualify for substance abuse services. A
senior-level community liaison at one RBHA stated that
Medicaid-eligible clients can receive mental health treatment
only if there is some evidence that a person’s mental health
problem exists aside from their substance abuse issues.
One of the audit’s case studies provides an example of this
situation:
Some RBHA officials incor-rectly
believe Medicaid clients
must be diagnosed with a
mental health problem to qual-ify
for substance abuse services.
Maria
Maria, a pregnant teenager who already had
one child, sought residential drug treatment in
December 1998. CPS initiated the service request
after taking custody of Maria’s first child, who
had medical problems including seizures and
blindness. The RBHA denied her treatment,
even though Maria was enrolled in Medicaid,
because they were under the impression that the
RBHA is not required to provide residential
substance abuse to anyone under the age of 21
who does not present any other mental health
diagnosis. Although the RBHA eventually
agreed to pay for residential treatment for sub-stance
abuse, the caseworker told Auditor Gen-eral
staff in August 1999 that she still did not
know if Medicaid funds cover treatment for
children who suffer only from substance abuse
and not other types of behavioral health prob-lems.
Finding II
OFFICE OF THE AUDITOR GENERAL
27
n Clients need not be free from substance abuse problems
before being eligible for other treatment—While some
RBHA staff incorrectly believe that substance abuse services
are not covered unless someone has another diagnosed be-havioral
health problem, others incorrectly believe that be-havioral
health treatment is not available for Medicaid-covered
clients unless the client is free from drug impair-ment.
In two Division-sponsored workshops on substance
abuse and mental illness in 1998, substance abuse providers
noted that mental health providers refuse services to clients
who are not “clean and sober.”
According to AHCCCS behavioral health rules, Medicaid-eligible
clients are entitled to receive any needed behavioral
health service. No requirement exists in Medicaid or
AHCCCS rules requiring clients to be drug-free to qualify for
behavioral health treatment. Providers may be confused
about whether clients need to be drug-free because non-
Medicaid-eligible adults, who may need to be designated as
SMI in order to receive state-funded services, may not be able
to obtain an SMI determination when their substance abuse
interferes with the RBHA’s ability to diagnose their mental
illness.
In addition to some believing that clients must be “clean and
sober” before being eligible to receive behavioral health
services, some RBHA providers and staff may incorrectly be-lieve
that clients who receive methadone treatment are not
eligible for other treatment. A representative from BHS’ Bu-reau
of Substance Abuse and General Mental Health noted
that some staff from provider agencies incorrectly believed
that people receiving methadone are not eligible for other
substance abuse treatment. The RBHA made such an incor-rect
assertion in Rachel’s case (see page 28).
Some RBHA officials incor-rectly
believe that behavioral
health treatment is not avail-able
unless Medicaid clients
are ”clean and sober.”
Finding II
OFFICE OF THE AUDITOR GENERAL
28
n Many respite-like services and residential detoxification
are covered services—In addition to the more general con-fusion
over coverage for substance abuse services, interviews
revealed two other examples of confusion about services
covered. First, confusion exists regarding respite services,
which provide relief to care givers in order to enable clients
to remain in their homes and communities. One advocate for
the disabled contended that Arizona’s Medicaid program
does not cover respite services for Medicaid-enrolled clients.
BHS’ medical director confirmed that misunderstandings
may exist regarding coverage for these services. BHS’ medi-cal
director asserts that Medicaid can be used to cover res-pite-
like services for Medicaid-eligible clients if the service is
billed under the category “behavior management.”
Second, residential detoxification, which is treatment pro-vided
in a 24-hour facility to manage withdrawal from abuse
substances, may not be clearly understood to be a covered
service, according to a BHS Bureau of Substance Abuse
and General Mental Health representative. Although it is a
covered service, it is not listed in some information identify-ing
services that can be billed to Medicaid.
Rachel
Rachel is a Medicaid-eligible, SMI
client on probation with bipolar dis-order
and past polysubstance abuse
issues. She has been receiving metha-done
for approximately ten years.
Rachel still abuses drugs and has
requested additional substance abuse
treatment services while enrolled in a
RBHA-provided methadone pro-gram.
However, the RBHA contends
that substance abuse treatment pro-grams
will not accept clients on
methadone; therefore, she cannot
obtain any additional substance abuse
treatment.
Finding II
OFFICE OF THE AUDITOR GENERAL
29
Literature suggests that
failing to treat substance
abuse problems along with
mental health problems
limits treatment effective-ness.
Enrollment Another
Source of Confusion
In addition to confusion over which services are covered by
Medicaid, confusion also exists on behalf of some agencies refer-ring
clients for services as to whether clients are enrolled in
Medicaid. During this audit, several of the cases provided to
auditors by the Administrative Office of the Courts and Juvenile
Corrections as examples of Medicaid clients who were referred
but unable to receive services were found by auditors to be cli-ents
who were not actually enrolled in Medicaid. Interviews
with the courts and Juvenile Corrections suggest that both agen-cies
are not always aware of whether their probationers or parol-ees
are enrolled in the Medicaid program, and have not always
been screening clients for Medicaid eligibility or systematically
referring them to the Department of Economic Security for en-rollment.
According to representatives from the Administrative
Office of the Courts, lack of access to information pertaining to
who is enrolled in AHCCCS or the RBHAs contributes to the
Office’s inability to identify Medicaid-eligible clients.
Lack of Clarity Has
Several Effects
These system-wide points of confusion have negative effects on
both delivery of services and state funding.
n Limitations on service effectiveness—By inappropriately
requiring clients to be “clean and sober” prior to receiving
treatment, some clients may be shut out of mental health
treatment. This is especially
significant since people with
mental health disorders often
have problems with substance
abuse. In fact, a 1998 study by
the Center for the Study of Is-sues
in Public Mental Health
performed in New York found that 57 percent of individuals
with a diagnosis of severe mental illness also have a diagno-sis
of substance abuse. Clients may also be shut out of serv-ices
if the referring agency fails to ensure that clients are en-rolled
in Medicaid or KidsCare before referring the client to
Finding II
OFFICE OF THE AUDITOR GENERAL
30
the behavioral health system for services. BHS and the
RBHAs receive limited dollars to provide services to people
who do not qualify for these programs. Failure to ensure cli-ents
are enrolled can result in service delays or denials.
n Shift of funding from Medicaid to state-supplied mon-ies—
The current confusion over Medicaid eligibility and
covered services results in the unnecessary expenditure of
state dollars. If a RBHA inappropriately denies a Medicaid-eligible
client services that Medicaid can cover, or when an
agency fails to ensure that a client is enrolled in Medicaid,
state monies may be spent by other agencies for behavioral
health services. By paying for services with state dollars
rather than Medicaid dollars, the State bears the full brunt of
the cost for service, rather than about only one-third of the
cost that it would pay for Medicaid-covered services. Agency
monies expended for behavioral health services come from
funds that the agencies could otherwise use for different
purposes, thereby reducing agencies’ ability to perform other
functions. Furthermore, in instances where the referring
agency is unaware as to whether the client is enrolled in
Medicaid, the potential exists for the referring agency to pay
for services out of state-only dollars even though the client’s
care is already covered through the Medicaid capitated rate.
Indeed, such double payment for services has occurred in
some instances in the past.
Several Changes Should Be Made
to Ensure That Clients
Receive Entitled Services
Several changes should be made to help clarify Medicaid cover-age
for services and individuals. BHS should create a policy that
clearly identifies Medicaid-covered services. BHS and AHCCCS
may also wish to consider changing the current capitation
method to further diminish confusion regarding Medicaid’s
coverage of substance abuse services. Finally, the courts and
Juvenile Corrections should identify screening methods.
Clarify policy—BHS can help dispel uncertainty regarding
Medicaid coverage by clearly describing such services in policy.
Currently, BHS’ policy regarding Medicaid-covered services is
Finding II
OFFICE OF THE AUDITOR GENERAL
31
incomplete and, in some instances, unclear. It states that covered
services are those described on a matrix of different codes used
by the RBHAs for billing services. However, the matrix itself
does not list residential detoxification services as a Medicaid-covered
service. In addition, it is not clear from either the policy
or the matrix that services such as respite or personal care can be
billed under the category “behavior management,” which is
covered by Medicaid. BHS and AHCCCS are currently propos-ing
to clarify the policy.
Consider changing capitation structure—To make it clearer that
substance abuse services are available for all types of Medicaid
clients, AHCCCS and BHS should consider changing the way
that capitation rates are set. As noted above, Arizona currently
sets different capitation rates for children, SMI adults, and adults
with general mental illness/substance abuse problems. This
capitation method does not appear to have been consciously
chosen by the State. Rather, it evolved over time as different
groups of individuals became covered under Medicaid, with the
last group being adults with general mental health disorders
who are not seriously mentally ill. This may lead people to be-lieve
that Medicaid-eligible children or adults with serious men-tal
illnesses cannot receive substance abuse treatment. Arizona
could move toward developing rates along only demographic
lines (for example, children, adults) instead. According to the
Urban Institute, most states’ managed care capitation rates are
simply divided along demographic lines rather than by diagno-sis,
although methods vary.
Develop methods to identify Medicaid and KidsCare eligible and
enrolled clients—In order to ensure that clients referred by the
courts and Juvenile Corrections are enrolled in Medicaid and
KidsCare before being referred to the behavioral health system,
these two agencies should develop additional screening methods
to identify Medicaid- and KidsCare-eligible clients and better
train probation and parole officers on eligibility requirements for
these programs. In addition, both the courts and Juvenile Cor-rections
should investigate ways of determining which of their
clients are enrolled in these two programs, since actual enroll-ment
is performed by the Department of Economic Security.
BHS and AHCCCS should explore the possibility of giving the
courts access to the names of their enrollees to ensure that Medi-caid
is used to pay for services when clients are enrolled in the
BHS’ matrix describing
services does not include
some Medicaid-covered
services.
Finding II
OFFICE OF THE AUDITOR GENERAL
32
program. If BHS and AHCCCS do provide the courts such ac-cess,
efforts should be made to ensure that client confidentiality
is maintained.
Recommendations
1. BHS and AHCCCS should develop a policy for RBHAs that
clearly specifies the types of services that are reimbursable by
Medicaid. As part of this, the AHCCCS/ADHS billing codes
(service matrix) should be updated.
2. AHCCCS and BHS should consider altering capitation rates,
in order to make it clearer that children and adults with seri-ous
mental illnesses are entitled to substance abuse services.
Further, the two agencies should work with RBHAs and
providers to educate them about entitlement to such services.
3. The Administrative Office of the Courts and Juvenile Correc-tions
should develop methods to screen clients for Medicaid
and KidsCare eligibility.
4. The Administrative Office of the Courts and Juvenile Correc-tions
should further train probation and parole officers on
Medicaid and KidsCare eligibility requirements.
5. The Administrative Office of the Courts and Juvenile Correc-tions
should investigate methods of identifying whether their
clients are enrolled in KidsCare or Medicaid.
6. BHS and AHCCCS should explore the possibility of giving
the courts access to the names of their enrollees to ensure that
Medicaid is used to pay for services when clients are enrolled
in the program. If BHS and AHCCCS do provide the courts
such access, efforts should be made to ensure that client con-fidentiality
is maintained.
OFFICE OF THE AUDITOR GENERAL
33
FINDING III CHANGES COULD ENHANCE
ABILITY TO SECURE
SPECIALIZED SERVICES
Even when there is no dispute about whether a client is eligible
or which agency should pay for the service, certain services are
simply unavailable. Clients in rural areas, for example, may not
have appropriate services nearby. While it may not be possible to
address all of these gaps in services, Auditor General staff identi-fied
three options that could enhance the RBHA’s ability to se-cure
specialized provider services:
n Increasing rates for certain services to attract more providers
for services that are not now sufficiently available;
n Ensuring that some or all provider contracts contain provi-sions
requiring them to provide services for more difficult or
disruptive clients; and
n Exploring ways to expand the pool of providers to include
behavioral health therapists, social workers, and others cur-rently
not part of the approved provider group.
Services Not
Always Available to
Entitled Clients
Services required by clients with complex needs may not be
available in some cases. Some clients require very intense, spe-cialized
services that may be difficult to provide, especially in
rural areas. In addition, providers may not always accept clients
who are difficult or disruptive or who have felony convictions.
Specialized services for some clients difficult to meet—Work
done for this audit, as well as studies already conducted of the
behavioral health service delivery system, indicate that provider
services may be lacking in some cases for clients with special
needs. For example, the studies performed by Human Systems
Certain services are simply
unavailable.
Finding III
OFFICE OF THE AUDITOR GENERAL
34
and Outcomes for the JK v. Griffith lawsuit found that provider
services tailored to fit children’s special needs were sometimes
lacking, especially in rural areas. In both northern and southeast-ern
Arizona, the studies noted that services are lacking for the
treatment of sexual abuse, youth sex offenders, and bonding or
attachment disorders. In addition, interviews with DDD staff
suggest that services for developmentally disabled clients may
not always be tailored to their needs.
Two of the cases reviewed by the audit team provide examples
of service availability problems for clients with special needs:
Services are lacking for the
treatment of sexual abuse and
youth sex offenders.
Jake
A RBHA transferred Jake, a 14-year-old
mentally disabled client, to a par-tial-
care facility that did not provide
treatment to clients having an I.Q.
score as low as Jake’s because there
was no other option for placement.
Kristine
Kristine, a 20-year-old developmental dis-abilities
client who is mildly retarded, suffers
from severe depression with psychotic fea-tures,
and cannot find a placement near the
geographic area where she would like to live.
After her discharge from the Arizona State
Hospital, the RBHA placed her in rural-area
group homes that could not handle her
extensive needs. Currently, despite Kristine’s
wishes, the rural RBHA and provider re-sponsible
for her care are attempting to place
her in a residential setting in Maricopa
County because the rural RBHA does not
have a residential placement to accommo-date
Kristine’s intense needs.
Finding III
OFFICE OF THE AUDITOR GENERAL
35
In Kristine’s and Jake’s cases, the lack of appropriate services
appeared to affect the quality of the clients’ treatment. For exam-ple,
the case coordinator at the partial-care setting in which Jake
was placed stated that he was not benefiting from the partial-care
program because he could not keep up with the other chil-dren.
The case coordinator believed that he required one-on-one
attention.
Disruptive and difficult clients not always accepted—Services
may also be limited for some clients because the clients are diffi-cult
to manage. Interviews with foster care and Developmental
Disabilities caseworkers suggest that clients referred for services
are sometimes screened to determine if the client’s behavior is
too difficult to handle, or rejected from facilities if they “act up.”
Joseph is a probationer in need of services who was denied
placement because of his criminal background:
Joseph
Joseph, a seriously mentally ill (SMI),
homeless, 34-year-old suffering from manic
depressive schizophrenia, who had served
time in jail for drunk driving, was approved
by a RBHA for treatment after he was ad-mitted
to an urgent care center. According
to the Probation Officer, the RBHA said that
the providers to whom he was referred
refused to accept him due to his past felony
conviction. As a result, the urgent care cen-ter
prepared to refer him to a homeless
shelter, until his probation officer placed
him in a residential treatment center funded
by adult probation. In this case, the provider
who apparently refused to accept Joseph
was not required by contract with the
RBHA to accept him. However, the RBHA
is under the obligation to ensure that some-one
provides medically necessary services
to entitled clients.
Finding III
OFFICE OF THE AUDITOR GENERAL
36
Changes Could Make
Services for Special-Needs
Clients More Available
Although it probably will not be possible to provide services in
every instance, changes can be made to better ensure that clients
receive the specialized care that they need.
n Changes affecting provider rates could make it easier for
RBHAs to pay some providers more money in order to at-tract
specialized providers.
n In addition, changes in contracting practices could ensure
that some providers are available to care for disruptive or dif-ficult
clients.
n Finally, altering the State’s Medicaid plan could allow
RBHAs to contract with individual certified master’s-level
practitioners, thus allowing RBHAs to fill some service gaps
when provider services are lacking.
Some service availability problems will probably continue—In
some cases, there may be no easy solutions to finding providers
who can meet clients’ specialized needs. In several interviews
with DHS, RBHA, and provider representatives it was noted that
the number of behavioral health providers is declining. Accord-ing
to the Division of Licensure, many providers have been go-ing
out of business in recent years, although the exact number is
unknown. Provider shortages may be especially pronounced
among providers who handle sex offenders. Indeed, Juvenile
Corrections officials noted that they are sending some probation-ers
out of state to receive treatment because of provider short-ages
in Arizona. In addition, limitations in the supply of provid-ers
may be occurring in rural areas. A 1999 study by the National
Rural Health Association found that there is “substantial evi-dence
that the number of mental health providers in rural
America is inadequate.”
RBHAs could increase provider rate flexibility to help attract
some providers—Paying providers higher rates to serve more
difficult clients could have an effect on securing such services.
RBHAs are allowed to pay providers any rate necessary to ob-tain
needed services. Nonetheless, according to a memo from
The number of behavioral
health providers is declining.
Finding III
OFFICE OF THE AUDITOR GENERAL
37
BHS to the RBHAs, some RBHA officials apparently believe that
provider contractor rates can be no higher than rates included on
a list BHS distributes to RBHAs to report services delivered. This
misperception may have affected the ability of RBHAs to con-tract
for a sufficient number of providers since they may not
have believed they were allowed to pay rates higher than those
listed. Currently, BHS is attempting to resolve this misperception
by informing the RBHAs that provider contract rates are flexible.
Ensuring that some providers take difficult clients—BHS could
also help ensure that the clients who are difficult or disruptive
receive specialized care by ensuring that a sufficient number of
the RBHAs’ contracts require providers to accept and serve cli-ents
referred to them. Currently, only one RBHA’s contract con-tains
such a clause. BHS, who oversees RBHA/provider con-tracting,
should ensure that at least a sufficient number of
RBHA/provider contracts contain such provisions, in exchange
for higher provider rates or other incentives.
Allowing RBHAs to contract with individual therapists—
AHCCCS and BHS could also help ensure that services are
available to clients with specialized needs by expanding the pool
of potential service providers. Currently, RBHAs are prohibited
from contracting directly with many non-physician behavioral
health professionals for service delivery. All services provided by
non-physicians must be delivered through licensed provider
facilities, with the exception of individual services performed by
licensed psychologists, physician assistants, and nurse
practitioners. Such a prohibition is included in contracts between
BHS and its RBHAs and in AHCCCS behavioral health rules and
reflects a limitation currently contained in the State’s Medicaid
plan that is submitted to the federal Health Care Financing Ad-ministration.
Although contracts currently do not allow the pool of providers
to be expanded in this way, it is possible to change the current
limitation. According to an AHCCCS official, the current re-quirement
exists because behavioral health therapists in Arizona
are not licensed. However, it is possible for AHCCCS to request
that the Health Care Financing Administration amend its Medi-caid
plan to allow services to be provided by approximately
RBHAs are allowed to pay
providers any rate necessary
to obtain needed services.
Amending the State’s Medi-caid
plan could allow the
RBHAs to directly contract
with individual therapists
certified by the State Board of
Behavioral Health Examiners.
Finding III
OFFICE OF THE AUDITOR GENERAL
38
5,200 substance abuse counselors and master’s-level social work-ers
and therapists, certified through the State’s Board of Behav-ioral
Health Examiners. Such a change could potentially make
professional and outpatient services more readily available. For
example, one official at a rural RBHA noted that the RBHA
wished to contract with a certified practitioner who specialized
in therapy for those who have been sexually abused, but may
have been prohibited from doing so due to this restriction.
Recommendations
1. BHS should re-examine listed provider rates to help ensure
that RBHAs are not artificially constrained in paying provid-ers
higher rates to obtain needed services for clients.
2. BHS should ensure that a sufficient number of
RBHA/provider contracts contain language requiring the
provider to accept and serve clients who are difficult or dis-ruptive,
in exchange for higher provider rates or other incen-tives.
3. AHCCCS should consider requesting a change in the State’s
Medicaid plan, allowing professionals certified by the Board
of Behavioral Health Examiners to also be eligible for pro-viding
services.
OFFICE OF THE AUDITOR GENERAL
39
FINDING IV EXPANDING BHS’ ROLE IN
SERVING JUVENILE OFFENDERS
COULD SAVE THE STATE MONEY
The limited role that BHS plays in providing behavioral health
services to juvenile offenders should be examined. Currently,
juvenile offenders who are taken out of prison for behavioral
health treatment receive services that are paid for with state-appropriated
Juvenile Corrections dollars. In addition, juvenile
sex offenders on probation or parole are not always referred to
the behavioral health system for possible services, even if they
are eligible for Medicaid-provided services. Providing such care
through Medicaid whenever possible could lower the State’s cost
of providing services, because the federal government pays the
majority of the cost under Medicaid. Under the current arrange-ment,
the State may not effectively leverage these federal dollars.
Making such a change would require BHS to take greater re-sponsibility
for providing the behavioral health component of
such care. In order to conserve state dollars and effectively lever-age
federal Medicaid dollars, the Division should ensure that the
RBHAs are made responsible for providing behavioral health
care to juvenile sex offenders and Medicaid-eligible prisoners
removed from prison for treatment. Also, the Division should
work with Juvenile Corrections to ensure that Medicaid is spent
whenever possible for such behavioral health services.
BHS Plays Limited Role in Providing
Services for Juvenile Offenders
Juvenile justice agencies sometimes pay for behavioral health
treatment for juveniles who could receive Medicaid-funded
treatment through the behavioral health system. The courts and
Juvenile Corrections often pay for behavioral health treatment
for sex offenders on probation or parole. Officials noted that
these people are not referred to the behavioral health care system
for services because the RBHAs will not treat these clients. This
situation occurred in one of the cases auditors reviewed (see
Patrick, page 40).
Finding IV
OFFICE OF THE AUDITOR GENERAL
40
It appears that juvenile justice agency officials’ belief that the
behavioral health care system may not accept sex offenders for
treatment may be well-founded. One interview with a RBHA
psychiatrist seemed to corroborate that RBHAs may indeed
reject such clients. This psychiatrist noted that children who are
sex offenders are traditionally shifted to other agencies for treat-ment.
Sex offenders on probation and parole are not the only ones who
receive services through the juvenile justice system when such
services could be provided by BHS. Currently, juvenile offenders
who are removed from prison to receive behavioral health
treatment in secure residential treatment settings receive their
treatment in facilities funded by Juvenile Corrections. According
to Juvenile Corrections officials, they have been told in the past
by the RBHAs that Medicaid will not pay for treatment for pris-oners,
even when they are removed from prison to receive
needed treatment. However, Medicaid will pay for services (ex-cept,
in some cases, room and board) as long as the juvenile is
enrolled, the services are medically necessary, and the juvenile is
not an inmate in a public institution.
Patrick
Patrick, a 16-year-old sex offender on
probation who was eligible for Medi-caid,
was not referred to BHS for
more than two years after his release
from prison. Instead, he was placed in
residential (live-in) treatment centers
funded by the courts, and a juvenile
sex offender program at Adobe
Mountain Correctional Facility.
Finding IV
OFFICE OF THE AUDITOR GENERAL
41
Shifting Medicaid-Eligible Juveniles to
Behavioral Health Services System
Could Help Stretch State Dollars
By not referring Medicaid-eligible juvenile offenders more read-ily
to BHS and its network of RBHAs, the State is losing an op-portunity
to leverage federal Medicaid dollars and stretch its
own appropriations for behavioral health services. If juvenile
offenders who have been released from prison (or removed for
medical care), qualify for Medicaid, their care could potentially
be paid for by Medicaid dollars. Medicaid cannot pay for serv-ices
delivered to inmates of public institutions. However, an
official at the Health Care Financing Administration (the federal
agency that oversees Medicaid) stated that although the admini-stration
has no written policy on the subject, it will allow Medi-caid
to pay for some or all medically necessary services for pa-tients
who are removed from prison for medical care. Any limi-tations
on the use of Medicaid dollars in such instances (such as
Medicaid not being available to pay for room and board in many
residential settings) are the same limitations that apply to the
delivery of any Medicaid service.
State dollars could be saved if services for unincarcerated Medi-caid-
eligible juveniles were provided through BHS and the
RBHAs instead of being paid for by Juvenile Corrections. In this
part of the system, the State pays approximately one-third of
Medicaid-provided services and the federal government pays
the remaining two-thirds. By ensuring that Medicaid paid for the
services provided to juveniles who were eligible for such sup-port,
the State could stretch those dollars that are appropriated to
provide care for people who must be supported solely by state
dollars.
Making Such a Change Would
Require a Shift in Responsibility
While Medicaid dollars could be used to deliver behavioral
health services to incarcerated persons removed from prison for
medical care, BHS staff have not believed Medicaid will pay for
such care. According to the Department’s Assistant Director for
Behavioral Health Services, the Division has understood that
such services are not reimbursable under Medicaid. Nonetheless,
Finding IV
OFFICE OF THE AUDITOR GENERAL
42
according to a HCFA official, the State does have the ability to
use Medicaid dollars to provide such services, although it is
under no obligation to do so. The HCFA official also noted, how-ever,
that a finalized policy statement in this area had not yet
been developed. An AHCCCS official confirmed that Medicaid
could potentially pay for medically necessary services for Medi-caid-
eligible prisoners who were removed from prison for treat-ment.
This official stated that AHCCCS had recently received a
memo from HCFA on the subject.
In order to conserve state dollars and effectively leverage federal
Medicaid dollars, the Division should ensure that the RBHAs are
made responsible for providing medically necessary behavioral
health care to juvenile sex offenders and Medicaid-eligible
prisoners removed from prison for treatment. Also, the Division
should work with Juvenile Corrections to ensure that Medicaid
is utilized whenever possible for such medically necessary
behavioral health services.
Recommendations
1. In order to conserve state dollars and effectively leverage
federal Medicaid dollars, the Division should ensure that the
RBHAs are made responsible for providing medically neces-sary
behavioral health care to juvenile sex offenders and
Medicaid-eligible prisoners removed from prison for treat-ment.
2. The Division should work with Juvenile Corrections to en-sure
that Medicaid is utilized whenever possible for juvenile
sex offenders and for persons removed from prison for medi-cally
necessary behavioral health treatment.
OFFICE OF THE AUDITOR GENERAL
43
OTHER PERTINENT INFORMATION
During this audit, other pertinent information was obtained
regarding numerous efforts undertaken to improve service
provision for people involved with the behavioral health sys-tem
and other state agencies, such as the Department of Eco-nomic
Security, the Arizona Department of Juvenile Correc-tions,
and the Administrative Office of the Courts. Table 1 on
pages 52 through 54 summarizes the groups and projects
auditors reviewed.
Coordination Problems Among
Agencies Identified
Since 1986, numerous efforts have been initiated to improve
coordination of behavioral health services between state agen-cies.
Multi-agency projects and legislative committees have
published studies on how to improve services for people (pri-marily
children) who are involved with more than one agency.
In addition, numerous efforts have ensued to improve inter-agency
coordination. While some efforts are initiatives stem-ming
from the federal government and the Governor, others
have actually evolved out of the recommendations made by
other groups trying to improve coordination. Furthermore,
recent efforts have been initiated as a result of litigation (JK v.
Griffith) contending that Medicaid-enrolled children receive
inadequate mental health services in Arizona.
These studies and efforts identify and attempt to solve a num-ber
of problems that confront clients involved with multiple
agencies. Such problems are more broad in scope than the one
identified in this report: namely, the ability of clients referred to
the behavioral health system to receive services (which this
report attempts to delve into more deeply). Instead, these stud-ies
and efforts identify and attempt to provide solutions to three
central problems:
4 Fragmentation in service delivery—Numerous studies
identify Arizona’s fragmented service delivery as a barrier
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
44
to people receiving appropriate services. For example, the
nonprofit group Partnership for Children wrote in a 1991
project report that “Children and families [in Arizona] re-ceive
services from multiple agencies with limited institu-tional
willingness to cooperate or communicate.“ It further
stated that “current services target specific problems with
fragmented services driven by funding sources rather than
meeting the needs of the whole family.” The same report
adds that different agencies each treat a small part of the
problem, often in different buildings and using their own
eligibility standards. Efforts such as Governor Hull’s No
Wrong Door Initiative, which is striving to ensure that peo-ple
needing services can go to any agency to begin the proc-ess
of receiving treatment, is aimed at resolving fragmenta-tion
problems.
4 Inappropriate service delivery—A number of studies have
noted that children involved with multiple state agencies
often receive services that are inappropriate or too limited to
fit their needs. For example, studies by the Partnership for
Children and the Joint Legislative Children and Families
Reorganization Study Committee both note that service de-livery
to children in this State is crisis-oriented, thus result-ing
in more costly and less effective services. The 1998
studies performed as a result of the JK v. Griffith lawsuit
noted that Medicaid-eligible children with multiple agency
involvement receive treatment that may be too brief and
limited to meet their needs.
4 Redundancy in service delivery—Many studies and ef-forts
focus on redundancies that exist in the current service
delivery system. For example, the Joint Legislative Children
and Families Reorganization Study Committee notes re-dundancy
in data gathering between agencies. Efforts such
as the Interagency Case Management Project, a joint part-nership
between state agencies that serve children, such as
DHS and the Department of Economic Security, are at-tempting
to address redundancy problems.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
45
Similar Recommendations Made
to Improve Service Coordination
The recommendations proposed and/or implemented by the
committees, task forces, and others cover a broad spectrum.
Suggested solutions for resolving the problems described above
range from redesigning the way services are delivered to pro-cedural
improvements, such as changing the amount and type
of information collected from shared clients.
Streamline the service delivery system—In order to address
the problem of a fragmented service delivery system, some
groups advocate a change to one streamlined process for
clients receiving services from multiple agencies. Groups
propose having one centralized location or case manager
capable of seeking services from more than one agency, to
minimize the number of agencies the client interacted with.
4 Centralized screening process—The Partnership for
Children recommended a system involving a uniform path
by which children and families receive services from multi-ple
agencies. It proposed a centralized screening process so
clients could be made aware of all services available to
them. Services would then be coordinated through a service
plan developed to address all of the client’s needs.
4 Local service centers—The Joint Legislative Children and
Families Reorganization Study Committee reported that
current services require families with multiple problems to
exit and re-enter multiple systems at multiple locations. This
committee advocated an integrated process for service de-livery,
as did the Partnership for Children. To do so, it pro-posed
the creation of family assistance centers. Case manag-ers
located at these centers would be trained to access serv-ices
from multiple agencies.
4 Integrated case management—Similarly, the Interagency
Case Management Project (ICMP), currently implemented
as a pilot project in limited areas, assigns a single case man-ager
to serve its clients. The project involves children and
their families who have multiple problems and are involved
with multiple agencies. Rather than have multiple case
managers from each agency, the family interacts with one
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
46
ICMP case manager who is cross-trained to provide services
through multiple state agencies.
Provide full continuum for specialized services—Addressing
the concern that services are too limited or inappropriate,
various efforts have recommended that a full range of serv-ices
be available to specific populations. The types of serv-ices
addressed include treatment for juvenile sex offenders
and substance abusers, as well as transitional services be-tween
agencies.
4 Specialty services for children and adolescents—In its
1997 Annual Report, the Children’s Behavioral Health
Council stated that a continuum is lacking in specialty
services, such as treatment for juvenile sex offenders and
substance abuse services for children and adolescents. Their
recommendation was to “develop easier access to services.”
In its 1998 Annual Report, the Council states that it will
continue to advocate for expanded substance abuse services
specific to children and for a more comprehensive service
system.
4 Services for released mentally impaired offenders—
According to the Council on Offenders with Mental Impair-ments,
it is important to establish services that incarcerated
juveniles need and programs that offer a continuum of care
after juveniles leave incarceration. In its 1998 Annual Re-port,
the Council recommends that a continuum of services
be available for released mentally impaired offenders. Of-ten,
developmentally disabled adults and juveniles are ex-cluded
from a range of transitional services because of their
illness and/or offenses. The Council recommends that in-teragency
cooperation be sought for providing a continuum
of housing and other transitional services for mentally im-paired
offenders released from custody.
Improve communication among agencies—To diminish frag-mentation
and facilitate common strategies to care for mu-tual
clients, groups have proposed and implemented ways
to solve communication problems among the agencies and
better serve the clients’ needs.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
47
4 Local councils—In its 1998 Annual Report, the Council on
Offenders with Mental Impairments calls for an increased
flow of communication between correctional facilities and
community mental health providers. The council also rec-ommends
establishment of local councils to increase the
networking between correctional facilities, criminal justice
agencies, and behavioral health agencies.
4 Interagency cabinet—The Joint Legislative Children and
Families Reorganization Study Committee recommends
establishing an Interagency Coordination Cabinet com-prised
of agency directors, local advisory boards, and local
assistance centers. Through its membership, the cabinet
would facilitate communication regarding the coordination
of agency procedures and the fostering of integrated service
delivery.
4 Multi-agency teams and coordinating councils—Im-proved
communication has taken place in Arizona, accord-ing
to the Independent Reviews being conducted as part of
the JK v. Griffith lawsuit. The reports cite examples of Multi-
Agency Teams and Care Coordinating Councils that have
been developed to resolve problems experienced by clients
involved with multiple agencies.
Improve information-sharing among agencies—In order to
address the problem of collecting redundant client informa-tion,
many groups recommend the creation of centralized
data systems. Agencies collect similar client information,
and oftentimes agencies are unaware of the services a client
may be receiving through another agency. A central system
used to store information would alleviate the problem of
collecting redundant information, as well as providing use-ful
information to agencies for treatment-planning purposes.
4 Create central information system—The Joint Legislative
Children and Families Reorganization Committee Study ex-amined
changing the information management architecture,
noting that 20 different informational systems are used to
support children and family services. The recommendations
involve creating a central, multi-agency information system
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
48
to collect client information from one location that would
allow a case manager to access the information from multi-ple
locations and/or agencies.
4 Create common database, allow interfaces between
agency computer systems—The Partnership for Children
effort recommends the creation of a database to gather
common data needed to support the necessary service de-livery
functions. It also advocates allowing the agencies’
systems to interface with each other.
4 Exchange assessment and case-planning data through
a data warehouse—The Assessment and Evaluation Work
Group sees a need to expand informational linkages beyond
demographic data to allow the exchange of assessment and
case-planning data. The group advocates developing a
common data warehouse.
4 Develop information-sharing links between criminal
justice and behavioral health system—As part of the
goals developed for its 1997 Annual Report, the Council
on Offenders with Mental Impairments sought to de-velop
information-sharing links among the stakeholders
for mentally impaired offenders. In its 1998 Annual Re-port,
the Council notes progress in improving data shar-ing
between the criminal justice and behavioral health
system. Various counties have established methods in
order to increase identification of RBHA-enrolled seri-ously
mentally ill clients who are incarcerated. One ex-ample
is the development of computer linkages between
the RBHA and Maricopa County Sheriff’s Office. Pima
County has also agreed to share information on the
booking and release of mentally impaired offenders with
the RBHA in Pima County.
4 Avoid collecting redundant information—Governor
Hull’s No Wrong Door Initiative, after assessing the existing
services provided by the state agencies and the service de-livery
processes used across multiple agencies, found that
common information should not be collected from the client
redundantly. The effort notes that agencies should have ac-cess
to commonly needed information once it is collected,
regardless of the source. The effort also advocates the crea-
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
49
tion of service lists to identify all family and child resources
available for successful referral to a service provider.
Provide more timely, complete, and accurate assessments—
Problems with inadequate service delivery have been noted
to stem from incomplete and inaccurate assessments. An
adequate assessment is essential to understanding the cli-ent’s
needs and planning for appropriate services. Groups
have focused on this important aspect and have suggested
similar recommendations in that common information
should be shared across agencies.
4 Incorporate developmental and long-term view—The
agencies involved with the JK v. Griffith lawsuit developed a
document called “JK Practices to Achieve Success for Chil-dren.”
The Practices call for assessments that are sufficient
and incorporate a developmental and long-term view.
There must also be a shared understanding of the child and
family as a result of the assessment process so that an ap-propriate
intervention plan can be developed.
4 Adopt similar guidelines—The Assessment and Evalua-tion
Work Group recommends that all agencies need to
adopt similar guidelines for assessments. Further, it advo-cates
the formation of collaborative special teams for those
served by multiple agencies to help identify the most effec-tive
service plan.
4 Common screening process—Governor Hull’s No
Wrong Door Initiative also recognizes that the focus should
be on integrating the processes for accessing services, such
as screening and referrals. The strategic plan for this project
recommends developing a common screening process that
could be performed at any point of the client’s entry into the
service system. Again, it advocates having common data
elements to better coordinate and share information for de-termining
the best way to meet the client’s needs.
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OFFICE OF THE AUDITOR GENERAL
50
Use funding more efficiently—It has been noted that agencies
sometimes provide limited services because of constraints on
their resources. Many groups recommend identifying fund-ing
barriers to enable efficient and effective use of resources
so that services can be provided to those in need.
4 Explore ways to make funding more flexible—In its re-view
of funding issues, the Partnership for Children identi-fies
current funding streams, which support services to
children and families. Often, the review discovers, funding
could be more effectively and efficiently spent if the State
has more flexibility in its use. The Partnership makes a few
recommendations for exploring funding options. One rec-ommendation
calls for designating a state-level entity
charged with developing a plan to maximize flexible fund-ing.
They call for the lead responsibility to be established
within the Governor’s Office, not within an existing agency.
4 Expand joint purchase agreement—In its 1997 Annual
Report, the Children’s Behavioral Health Council advo-cates
expanding the existing Single Purchase of Care
contract (a contract between state agencies and DHS,
DES, and other agencies aimed at simplifying provider
contracting) to obtain more services for children and
families. The Council also recommends that government
agencies become more involved in sharing the responsi-bility
for children. According to the Council, this would
involve cost-sharing agreements among the agencies. In
its 1998 annual report, the Council says it supports DHS
in obtaining grants to fund innovative children’s behav-ioral
health programs. The Council also advocates find-ing
additional non-Medicaid revenue (i.e., state appro-priations
and federal block grants).
4 Establish mechanism to ensure sufficient funding—
The Council on Offenders with Mental Impairments advo-cates
establishing a funding mechanism to ensure that
services are supported for non-incarcerated mentally
disturbed youth. They call for reviewing innovative pro-grams
to fund services for mentally ill juveniles. This in-cludes
programs that are funded by grants for additional
services.
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OFFICE OF THE AUDITOR GENERAL
51
4 Maximize use of federal funds—In its 1999 Progress Re-port,
the Behavioral Health Subcommittee also recommends
that funding support the needs of children in the State’s
care. The Subcommittee emphasizes that special attention
be taken to ensure providers/placements are not changed
based on how a service is funded. They also advocate the
use of Medicaid and KidsCare funding to its fullest extent to
conserve state monies.
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
Table 1
Behavioral Health Services Coordination Audit
Efforts to Improve Coordination of Behavioral Health Services
Group/Project Authorization Participants Responsibility Status
Behavioral Health
Planning Council
Laws 99-660 (U.S.
Congress 1986)
ADHS, AHCCCS, DES,
criminal justice representa-tives,
providers, consumers,
and families
Determines whether behavioral health
services are sufficiently provided
across the State
Meets quarterly
Children’s Behav-ioral
Health
Council
A.R.S §§36-3421 and
3422 (1988)
ADE, ADHS, ADJC,
AHCCCS, AOC, DES, Gov-ernor’s
Office, legislators,
and community representa-tives
Provides recommendations on im-proving
behavioral health issues facing
Arizona’s children. Oversees devel-opment
of a single, coordinated con-tinuum
of services for children. Re-views
intergovernmental agreements
entered into by agencies serving chil-dren.
Meets monthly and issues an
annual report to the Governor
and Legislature. Council to be
sunset December 1999.
Partnership for
Children
Arizona Community
Foundation and
Tucson Community
Foundation (1991)
ADE, ADHS, ADJC,
AHCCCS, AOC, DES, Gov-ernor’s
Office, legislators,
providers, and community
representatives
Created a comprehensive, integrated,
and responsive service delivery model.
Developed model for a coor-dinated
system of care. Pro-posals
made to Legislature for
funding pilot programs, but
model has never been imple-mented.
Council on Of-fenders
with
Mental Impair-ments
Laws 1992, Chapter
234
ADHS, ADJC, AOC, DES,
DOC, RBHAs, a representa-tive
from the Behavioral
Health Planning Council,
and law enforcement and
community representatives
Addresses issues concerning the wel-fare
of offenders with mental impair-ments.
Identifies needed services for
offenders, develops plan to meet their
treatment needs, and makes recom-mendations
to improve service coordi-nation.
Meets monthly and issues an
annual report to the Governor
and Legislature.
52
Other Pertinent Information
OFFICE OF THE AUDITOR GENERAL
Table 1 (Cont’d)
Behavioral Health Services Coordination Audit
Efforts to Improve Coordination of Behavioral Health Services
Group/Project Authorization Participants Purpose Status
Governor’s Ac-tion
Committee
Governor (1993) ADE, ADHS, ADJC, AOC,
DES, service providers,
consumers, and advocates
Developed an intergovernmental
agreement (known as the Children’s
IGA) between state agencies that serve
children.
Recommendations provided
to Governor in 1993.
Children’s IGA
Executive Com-mittee